What is this post about?
I really like the concept of nudging. It is the concept of shaping decision making processes to improve the outcome for an individual or society without restricting their possible choices. To me, it really feels like the free real estate of governance but I might be biased. In this post, I will give a brief overview of what nudging is, but this is not the main focus since you will find plenty of resources online. I will then address the main counterargument to nudging, i.e. that it is just manipulation in fancy; present strategies on how nudging could improve your own life, and discuss some of its risks.
Nudging - a short overview
Nudging is a concept that was coined and researched mostly in behavioral economics, most famously by Richard Thaler and Cass Sunstein who wrote a book on the topic. It evolved from the work on human biases, e.g. by Tversky and Kahneman or Thaler, that shows that there are a lot of ways in which humans do not make rational decisions in many circumstances. The idea of nudging is to account for that irrationality and shape systems, environments, and decision making processes in such a way that people are more likely to decide for an outcome that is good for them or society at large. An important framing that Thaler and Sunstein use is what they call Libertarian paternalism. This means that a nudge alters people’s behavior without changing their incentives significantly or restricting their choices entirely. For example, altering the way in which healthy food is presented is a nudge, banning junk food is not and a sugar tax is probably somewhere in the middle. Nudging, therefore, does not restrict your rational choices, it mostly improves the irrational ones. Types of nudging include a) Altering the order in which something is presented. Changing the order in which food is presented in public cafeterias, for example, can increase or decrease the uptake rate of healthy food significantly. b) Changing the default. If renewable is the default when choosing an electricity plan significantly more people buy it than if it’s not the default. If organ donation systems are opt-out rather than an opt-in, way more people choose to donate and thereby save lives. c) Making socially desirable behavior more salient. A sign that says “most people tip 15%” can increase tipping amounts. As a consequence of these findings, many countries have set up specific “Nudge units” that research and implement nudges to improve individual decision making. If you want to read about nudging in more detail, I can really recommend the Nudging book, a Freakonomics radio episode or you can just read the Wikipedia article.
One thing that I really want to emphasize is how much of a difference nudging can have. In the context of organ donations, the opt-in system of Germany has a consent rate of 12% where-as the opt-out system of the culturally close Austria has 99.98%. Just think of all the lives being saved through this one small change. Getting around 40000 additional people per year to quit smoking in the UK alone is another example of effective nudging. Nudging people to take care of their pension plans early on in their life massively helps them when they are older. The list goes on and on but it should be clear by now that there is a large tangible effect of nudging.
Manipulation … but nice
We are being manipulated all the time. When we go to the supermarket the expensive stuff is at eye level where it is easiest to see. Candy and sweets are next to the check-out such that we are more likely to give in to our urges while waiting. When we shop online every mouse click is tracked and every interface is optimized to manipulate us into buying something. If you go on Facebook or Twitter your personal data is analyzed and used to send you more targeted ads to increase their efficacy. Private news outlets show you selective information to further the political agenda of their share-holders. No matter which environment you are in, you are manipulated in some way. Most of these kinds of manipulation are very successful and they are used more and more by private companies. So, I think it’s a bit strange that scientists have understood that humans tend to act irrationally in many ways, private companies have understood it but governments close their eyes and pretend that humans are rational beings that make free and optimal decisions all the time. Given that we are in environments that manipulate us all the time I would rather have a government that listens to the behavioral economists and nudges me in a direction that is in my or society’s long-term interest rather than just being a pinball of profit-driven companies. This is also the main message I want to get across in this paragraph: When a state decides not to nudge its citizens so that they can make free and rational decisions, these citizens are being manipulated by other players and their decisions are not free. If you want to maximize your citizens’ true preferences you should nudge them to counterbalance these influences and their own short-term biases.
Additionally, every design of the decision-making process is a nudge one way or the other. If you design an opt-in organ donation system you implicitly nudge people not to donate. If you don’t present the salad first in the cafeteria you nudge people to eat less healthy and if you don’t choose clean energy as the default option you nudge people to buy less clean energy. Given that every design implicitly or explicitly influences the outcome in some way we should rather try to choose those that give better outcomes rather than random ones.
Even though I can totally understand the uneasy feeling associated with nudging as you essentially consent to be manipulated (which seems paradoxical at first glance) I think it’s not as bad. There are lots of decisions where we consent to give away agency to gain some other good. When we sign the terms and conditions of Facebook or Twitter we consent to be monitored and receive targeted ads because we value the benefits of these platforms higher than their manipulation. Whenever you do sports with others instead of alone because you always lose motivation you essentially give away some agency and use the peer pressure to stay committed to becoming a more healthy person. If you tell everyone that you will now start eating more healthy before you do so you nudged yourself since your friends will call you out and you have more to lose. These and many more are situations where we willingly give away agency because we value other benefits higher.
There will most likely always be some force manipulating us in certain ways and pretending that we are all rational won’t fix that. I would rather want an actor that is somewhat aligned with my interests or that of society than one that is not necessarily aligned such as a private company trying to sell me more stuff. Even though it has a weird feeling in the beginning I want the state to level the playing field and nudge me in a positive direction. This also means that system designers should be aware of the fact that nudging is happening one way or the other and, therefore, be aware of the responsibility that comes with every design choice.
What now?
If the previous arguments were convincing there are several ways in which nudging can be applied to improve your life. The largest effects of nudging are likely achieved on a government level which is hard to influence from an individual perspective. You can of course always send your local representative a letter begging them to gamify your tax returns but this will probably not achieve much. Slightly more effective would be to actively check if politicians have any statements on nudging on their platform or to write e-mails to the party staff during pre-election phases. But your overall probability of changing the system is quite hard if you are not actively working in governance.
However, you can also apply nudging on an individual level. There are many different possible strategies, some of which I want to present in the following. Personally, I find it most effective to shape my environment such that it is very easy to do good things and hard to do bad things. If you don’t want to eat sweets you should not buy them in the first place or, if they are already in your house, complicate access by putting them on top of the cupboard such that they are unreachable without a chair or put them in the basement. Having more time to think and more annoyance in the process is often already enough to stop you from bad habits. If you want to eat more fruit you should place them in a big bowl in the most visible space of the kitchen or living room. Just the fact that they are there and always visible is often sufficient to create a good habit. If you are distracted by your phone I can recommend putting it somewhere where it is not visible and requires an active effort to reach. I usually throw it on my bed once I’m working at my desk because I would have to get up and walk through the room to pick it up.
A second strategy involves publicly committing to a goal to increase the chances of actually sticking to it. This might involve telling a group of friends that you intend to run once a week or do X push-ups at a certain point in time. It further improves your probability of success if you also add a small financial incentive such as a 10€ donation to an EA organization if you miss your goal or a 5€ donation whenever someone catches you doing the thing you wanted to avoid such as smoking or eating meat. Even though the public commitment or the financial loss is pretty small in the large scheme of things they motivate us to a disproportionately large extent. People just really don’t want to lose when social capital is attached to it.
Another strategy is gamification. Gamification is the application of game-design elements and game principles in non-game contexts. While it might be hard to add an XP bar to your life, there are apps that give you levels or other meaningless rewards that feel good for no apparent reason whenever you complete an item or hold a streak. Most of the time there are task-specific third-party apps with different levels of gamification. Your fitness watch might, for example, reward you for a certain number of steps per day or Strava tells you how many personal records you broke or how fast you are going compared to other cyclists, runners or swimmers.
Risks
Nudging is not entirely without downsides but I think they are rather small compared to its benefits.
First, nudging is a tool to achieve a goal. If the goal is not desirable then nudging won’t fix it either but is actually harmful. If a state has goals that are unaligned with yours as an individual nudging increases the probability of you acting against your goals. For example, to increase GDP the state could nudge its citizens to spend more money even though you personally might want to save it or a bad actor could try to nudge you not to vote if you oppose them. However, I think this is a very small risk overall for two simple reasons: a) Most nudging is done on things that are nearly universally accepted as positive, e.g. saving lives, being more healthy, preventing you from being poor when you are old, etc. exactly because the nudging units want to prevent the image of being the “manipulation ministry” at all cost. And b) If a state leadership has bad intentions they usually don’t fool around with soft measures such as nudging. If they don’t want your vote to count they will just gerrymander the shit out of your district, purge your vote or do all the other stuff the Republicans have mastered over the last decades. Why should they stick to probabilistic interventions such as nudging when they can just implement deterministic measures such as changing the law and prevent the possibility at all.
Second, sometimes we lose track of the goal and the measure becomes the target. When you have publically committed or gamified your goal and your attitude towards it changes during the process you might stick to it even though you should not want to. However, this probably happens not that often and you can always change your strategy after your re-evaluation. The chosen incentives are usually so small that you have very limited losses if you switch.
Summary
I think it is bad when governments pretend that humans are rational agents when most scientific evidence suggests otherwise. Rather than closing our eyes, we should design systems to account for our biases to be more likely to improve ourselves and society at large. Nudging does exactly that. While it sometimes sounds scary because it feels like manipulation I think this concern is overblown. States use nudging only for goals that are pretty clearly good such as saving lives or improving your health and you are being manipulated by other actors all the time anyway. Thus, the question is not whether you want to be manipulated but rather whether you want to be manipulated by a good actor additionally to all other actors manipulating you. Independent of the government there are also a lot of nudging strategies you can apply to your own life to improve your decision making.
One last note
If you want to get informed about new posts you can subscribe to my mailing list or follow me on Twitter.
If you have any feedback regarding anything (i.e. layout or opinions) please tell me in a constructive manner via your preferred means of communication.