Nudging us towards a better future?

Over two days in London this September, the Behavioural Insights Team hosted the inaugural Behavioural Exchange Insights Conference at Park Plaza Westminster.

Addressing an array of global social issues, the sold-out event brought together 900 of the world’s leading behavioural insights experts, policy makers and practitioners to try to bridge the gap between changing social norms into policies that can affect the world for the better. Amongst the leading the speakers were esteemed Nobel Prize Winner Daniel Kahneman and President of the American Economics Association Richard Thaler.

Starting the conference by tackling ‘The World’s Biggest Challenges’ head-on was a team including David Halpern, psychology graduate and Chief Executive of the Behavioural Insights Team, discussing social issues such as poverty and inequality. Professor Iris Bohnet from the Harvard Kennedy School spoke to the impact of gender inequality at the highest levels within the workplace. To remedy this, the British government found that telling companies a positive statistic (that 94 per cent of companies had at least one woman on the board) rather than a negative one (that only 17 per cent of board members were women) led to a much better response in those companies’ promotion policies.

The science and style of behaviour change communication were debated between leading psychologists Steven Pinker and Robert Cialdini, where the effectiveness of ‘Recipocracy’ (that people are more likely to give something up if another party has also given something up) was highlighted in Cialdini’s example that hotel guests are more likely to reuse towels if told their hotel has already given to an environmental charity.

Health and behaviour change was also given thorough and thought-provoking examinations. The ‘interactive’ session ‘You Are The Doctor’ allowed the audience to experience how good and bad medical decisions can cause life or death, and stress-tested the alternatives. Health experts such as Cornell University’s Brian Wansink (whose obesity research contributed to the introduction of smaller ‘100 calorie’ packages for reduced portion size) and the White House’s Sam Kass (who served as Executive Director of the First Lady’s ‘Let’s Move’ campaign) then discussed the epidemic of obesity and solutions to change widespread health behaviours around impulsive eating patterns.

Topical sessions on finance and behaviour demonstrated the UK government’s pressing need to entice the public to actively manage their money for sustained financial health, as best exemplified in the recent pension reforms. Effective communication of the implications of poor financial management drove reformed behaviour, as observed after reminding people that taxes fund vital public services, rather than simply demanding payment without explanation. Another route was equally effective, as explained by David Halpern:

‘Findings from behavioural science show us that people are strongly influenced by what they think their fellow citizens are doing. The Behavioural Insights Team, for example, has shown that people are more likely to pay their tax when they are reminded of the truth - that most people pay their tax on time. So this survey has important implications. We underestimate how virtuous our fellow citizens are, and this really matters. If we think others are cheating, not saving enough, or not eating healthily, then we’re much more inclined to do the same ourselves. Our perception of others’ behaviours is often way out of line with reality, and this has consequences for what we ourselves do.’

Halpern’s references reflected the findings of the Ipsos Mori survey released at the event. This found that Britons underestimate how much exercise they really do, and the extent to which they save for retirement. The survey found that 65 per cent of the population are not saving enough for retirement, when government studies suggest it’s actually 43 per cent; and that only 42 per cent of their countrymen do the recommended amount of exercise each week, when detailed physical activity surveys indicate it is 57 per cent.

The survey, which was conducted in the UK, US, Canada, Australia, France and Germany, also found that people believed others behaviours was generally worse than their own. For example people think that 52 per cent of their fellow citizens have pretended to be sick in the past year, but only 23 per cent of workers say they have done so themselves.

On these and many other key topics that affect our everyday in big and small ways such as crime, the environment and education, it was acknowledged that behavioural economics could seem paternalistic, and that turning theory into policy brought with it responsibility, and uncertainty. In a plenary session that was by far the highlight of the event, long-time colleague Richard Thaler interviewed Daniel Kahneman (dialling in from New York) about these issues, whose words were wise as a reminder of consequence: ‘In designing policy you have to worry about who the losers are going to be. What I believe is when you are introducing change there will be winners and losers. Losers will fight harder. Reform is more expensive than expected. Leaders don't anticipate loss aversion… they create winners and losers who they have to compensate… That would be the first piece of advice: who will the losers be and what will they be able to do to you?’

As final parting words, Kahneman’s concerns felt apt to the number of policy makers in the room: ‘I think there is an awful lot of decision-making going on within firms and government and much of it is really very poor quality - it has evolved but it hasn't been designed. And designing decisions is a very large field. Seeing an organisation that produces decisions and asking: what quality controls can we apply? Getting into that is a very big challenge’. 

Perhaps Thaler nailed the shortcut to the solution to this challenge by asking Kahneman how one can get buy-in for change management even if you don’t have a Nobel prize? ‘Well, I think every consultant should have one’, quipped Kahneman.

- Report from Eloise Smart.