Lecture notes Nudging
Lecture 1.
Behavior change already exists, right?
-Therapy (e.g. get rid of anxiety issues)
-prevention program: preventing behaviour before it happens (e.g. prevent from snacking and live
more healthy)
-educational program: e.g. when they already behave wrongly then they should start an educational
program
Those 3 things have in common that people are aware of their own behaviour
Nudging relies on different system of thinking
What is different about nudging?
Relies on different system: two ways to think (dr. Spork vs. Homer Simpson)
System 1: impulsive
system 2: reflective, overthinking
Illustration of speed:
algorithm (system 2) vs. heuristic (system 1)
So what do we use more often?
We use system 1 more, we use a lot of mental shortcuts! To make our live more easy and to make
decisions more easy
what kind of shortcuts?
some we use to perceive the world:
1. Cheerleader effect: you see the whole group rather than the individual: you judge the individuals
as a group instead of as an individual
if you see girls in a group they are perceived as more attractive as to when you would see them
individually: we assign the same attractiveness to the whole group
2. Clustering illusion: we are very good in seeing patterns when there are no patterns
In the 1st case you take shortcut and miss seeing individuals and in the 2 nd you see sth that is not
there
Some we use to perceive/judge ourselves:
1. Ikea effect: if you build something yourself (e.g. lego sets, origami figures) you tend to value that
more than when someone else has done it
2. Planning fallacy: we tempt to overestimate how much time people take to do a certain task and
underestimate the time you need yourself
So no problem! As long as we are aware…
-> but we are not always aware!
Gi Joe Fallacy: knowing or recognizing yourself is only a small part of what controls our behaviour
,(e.g. habits, situation more important than conscious selve)
so even: I know that I know that knowing I have biases isn’t enough!
Are biases a bad thing?
There are cognitive biases that sometimes leads to suboptimal choices
but what if we use those same biases? -> NUDGING!
Nudging:
“a nudge is any aspect of the choice architecture that alters people’s behaviour in a predictable way
without forbidding any options or significantly changing their economic inventives”
-> choice architecture: any aspects that determines the way a person makes a choice e.g. physical
environment for example the way the supermarket is designed, social information (affects salience of
the choices
-> knowing the biases of people you can predict their behaviour
Isn’t using biases manipulative?
-what about our freedom? ->
-libertarian paternalism: nudging doesn’t forbid choices (2 nd part of definition), you still have
freedom of choice and shouldn’t take much more effort
What kind of behaviour should we nudge?
choice that:
-have a delayed effect (making the right choice has a delayed effect then earlier focus on immediate
effect e.g. unhealthy eating-> immediately have a nice chocolate bar ipv staying healthy in the future)
-are difficult (take a lot of mental effort e.g. picking out a pension plan)
-are infrequent
-have poor feedback
-have an unclear outcome
What makes a good nudge?
Principles to keep in mind:
-iNcentives: make the desired effect rewarding
-> Non complex choice structure: make choice outcome clear
-Understand mappings: make choice outcome clear (how do they couple the choice they make to the
outcome they get)
-Defaults: make use of laziness shortcuts
-Give feedback: make choice outcome clear
-Expect error: by foreseeing shortcuts people will use (so expect that people have biases)
-Structure complex choices: make choice outcome clear
-> salient incentives: make the desire defects clearly rewarding
Is it really a nudge, checklist:
1. The nudge aims at altering the choice (not options, feelings etc.)
2. The nudge steers in the direction of the choice alternatives that is best for the nudge in the long-
term (no marketing)
3. The nudge does not alter the economic incentives (no discounts)
4. Alternative options are still available (at the same location)
, 5. It involves a change in the choice architecture (not aimed at teaching people what is healthy or
sustainable)
Lecture 2 Dual-process theories 30-11-2018
Whitehead: government employs the insights of creepy behavioural scientists to influence citizens’
behaviour
VS.
Sunstein: government always influences behaviour- what’s wrong with using scientific insights if they
serve the wellbeing of the population
Nudges: popular & contested
-sexy devices in urgent need of theoretical underpinnings? (footsteps, flies in toilet, portion size,
piano stairs)
is this science? What do all these funny examples have in common? In academia we need to explain
this and why they work, how they can influence people. Not only design but also why and how they
work
Decision making & economy
-daniel Kahneman nobel prize economy 2002
book: thinking, fast and slow
-American psychologist article = crash course
Thinking fast & slow
-elaboration on Herbert simon’s notion of bounded rationality in response to;
-classic economic theories of rational decision making: considering all options and their features to
arrive at maximum utility
-full rationality is a normative standard compared to which human underperform
-bounded rationality describes the harsh reality of human decision making (descriptive standard:
how people actually make decisions)
What’s in the black box? (input -> black box -> output)
-system 1 thinking (=95% of human thinking) was discovered as part of the cognitive revolution (how
people think & decide got more interest) in the 50ties after decades of behaviourism
-a system 2 was ‘invented’ to tame/constrain/regulate the irrational system 1
System 1 & psychology
-resonates well with psychological insight that people seem to act irrational, not doing what they
want to do and consider important . e.g. values, goals that we find important, we don’t act upon
them
(intent-behavior gap: what people say they want vs. what they actually do)
Dual system theories: not 1 but many
system 1 – heuristic- experiental- intuitive- reflexive- hot- holistic- peripheral- implicit- automatic-
impulsive- unconscious
Lecture 1.
Behavior change already exists, right?
-Therapy (e.g. get rid of anxiety issues)
-prevention program: preventing behaviour before it happens (e.g. prevent from snacking and live
more healthy)
-educational program: e.g. when they already behave wrongly then they should start an educational
program
Those 3 things have in common that people are aware of their own behaviour
Nudging relies on different system of thinking
What is different about nudging?
Relies on different system: two ways to think (dr. Spork vs. Homer Simpson)
System 1: impulsive
system 2: reflective, overthinking
Illustration of speed:
algorithm (system 2) vs. heuristic (system 1)
So what do we use more often?
We use system 1 more, we use a lot of mental shortcuts! To make our live more easy and to make
decisions more easy
what kind of shortcuts?
some we use to perceive the world:
1. Cheerleader effect: you see the whole group rather than the individual: you judge the individuals
as a group instead of as an individual
if you see girls in a group they are perceived as more attractive as to when you would see them
individually: we assign the same attractiveness to the whole group
2. Clustering illusion: we are very good in seeing patterns when there are no patterns
In the 1st case you take shortcut and miss seeing individuals and in the 2 nd you see sth that is not
there
Some we use to perceive/judge ourselves:
1. Ikea effect: if you build something yourself (e.g. lego sets, origami figures) you tend to value that
more than when someone else has done it
2. Planning fallacy: we tempt to overestimate how much time people take to do a certain task and
underestimate the time you need yourself
So no problem! As long as we are aware…
-> but we are not always aware!
Gi Joe Fallacy: knowing or recognizing yourself is only a small part of what controls our behaviour
,(e.g. habits, situation more important than conscious selve)
so even: I know that I know that knowing I have biases isn’t enough!
Are biases a bad thing?
There are cognitive biases that sometimes leads to suboptimal choices
but what if we use those same biases? -> NUDGING!
Nudging:
“a nudge is any aspect of the choice architecture that alters people’s behaviour in a predictable way
without forbidding any options or significantly changing their economic inventives”
-> choice architecture: any aspects that determines the way a person makes a choice e.g. physical
environment for example the way the supermarket is designed, social information (affects salience of
the choices
-> knowing the biases of people you can predict their behaviour
Isn’t using biases manipulative?
-what about our freedom? ->
-libertarian paternalism: nudging doesn’t forbid choices (2 nd part of definition), you still have
freedom of choice and shouldn’t take much more effort
What kind of behaviour should we nudge?
choice that:
-have a delayed effect (making the right choice has a delayed effect then earlier focus on immediate
effect e.g. unhealthy eating-> immediately have a nice chocolate bar ipv staying healthy in the future)
-are difficult (take a lot of mental effort e.g. picking out a pension plan)
-are infrequent
-have poor feedback
-have an unclear outcome
What makes a good nudge?
Principles to keep in mind:
-iNcentives: make the desired effect rewarding
-> Non complex choice structure: make choice outcome clear
-Understand mappings: make choice outcome clear (how do they couple the choice they make to the
outcome they get)
-Defaults: make use of laziness shortcuts
-Give feedback: make choice outcome clear
-Expect error: by foreseeing shortcuts people will use (so expect that people have biases)
-Structure complex choices: make choice outcome clear
-> salient incentives: make the desire defects clearly rewarding
Is it really a nudge, checklist:
1. The nudge aims at altering the choice (not options, feelings etc.)
2. The nudge steers in the direction of the choice alternatives that is best for the nudge in the long-
term (no marketing)
3. The nudge does not alter the economic incentives (no discounts)
4. Alternative options are still available (at the same location)
, 5. It involves a change in the choice architecture (not aimed at teaching people what is healthy or
sustainable)
Lecture 2 Dual-process theories 30-11-2018
Whitehead: government employs the insights of creepy behavioural scientists to influence citizens’
behaviour
VS.
Sunstein: government always influences behaviour- what’s wrong with using scientific insights if they
serve the wellbeing of the population
Nudges: popular & contested
-sexy devices in urgent need of theoretical underpinnings? (footsteps, flies in toilet, portion size,
piano stairs)
is this science? What do all these funny examples have in common? In academia we need to explain
this and why they work, how they can influence people. Not only design but also why and how they
work
Decision making & economy
-daniel Kahneman nobel prize economy 2002
book: thinking, fast and slow
-American psychologist article = crash course
Thinking fast & slow
-elaboration on Herbert simon’s notion of bounded rationality in response to;
-classic economic theories of rational decision making: considering all options and their features to
arrive at maximum utility
-full rationality is a normative standard compared to which human underperform
-bounded rationality describes the harsh reality of human decision making (descriptive standard:
how people actually make decisions)
What’s in the black box? (input -> black box -> output)
-system 1 thinking (=95% of human thinking) was discovered as part of the cognitive revolution (how
people think & decide got more interest) in the 50ties after decades of behaviourism
-a system 2 was ‘invented’ to tame/constrain/regulate the irrational system 1
System 1 & psychology
-resonates well with psychological insight that people seem to act irrational, not doing what they
want to do and consider important . e.g. values, goals that we find important, we don’t act upon
them
(intent-behavior gap: what people say they want vs. what they actually do)
Dual system theories: not 1 but many
system 1 – heuristic- experiental- intuitive- reflexive- hot- holistic- peripheral- implicit- automatic-
impulsive- unconscious
