Behavioral Science & Policy This Week (11.5.15)
Anthony Freda (NYT)
In the New York Times' Upshot, Dick Thaler discussed the ethics of nudging. Despite his pleas that people "Nudge for good," nudges can be used to good or bad ends. Thaler underscored three important principles: that nudges be transparent, easy to opt out of, and in the service of people's welfare. He goes on to consider the question of nudging in the government vs. the private sector, with reference to Akerlof and Shiller's new book, Phishing for Phools (which we've covered here and here):
Some argue that phishing — or evil nudging — is more dangerous in government than in the private sector. The argument is that government is a monopoly with coercive power, while we have more choice in the private sector over which newspapers we read and which airlines we fly.
I think this distinction is overstated. In a democracy, if a government creates bad policies, it can be voted out of office. Competition in the private sector, however, can easily work to encourage phishing rather than stifle it.
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Thaler's partner in crime on the Save More Tomorrow retirement savings work, Shlomo Benartzi, wrote an interesting piece in the Wall Street Journal explaining why people should delete the stock ticker app from their phones. In short, the more often you check your portfolio, the more likely it will have decreased in value, making you more likely to make poor, loss aversion-driven decisions. Benartzi also announced a new initiative in California (see tweet below) and has a new book, The Smarter Screen, about nudging in the digital age.
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And Cass Sunstein writes about the fate of calorie information interventions in his regular Bloomberg View column, arguing that despite mixed evidence, it's far too soon to close the book on these sorts of nudges to help people make healthier choices. Personally, I think that when interventions like these yield mixed results, we should see that as an opportunity to better understand what's going on and refine our theories and intuitions. Stay tuned for an article on the blog in the coming weeks about one of the interventions Sunstein writes about:
Major effects have also been found from a "traffic light" system, with color-coded labels: green (healthy), yellow (less healthy), and red (unhealthy). A team of researchers at Massachusetts General Hospital, led by Anne Thorndike, found that such labels produced substantial reductions in sales of high-calorie beverages and increases in sales of low-calorie ones in a large hospital cafeteria.
J-PAL made a big announcement today:
J-PAL North America is launching the State and Local Innovation Initiative to pair US state and local governments with researchers to generate evidence-informed solutions to challenging social problems. Through the initiative, selected US state and local governments will receive funding, on-the-ground technical support, and access to J-PAL's network of affiliated professors from leading universities in the United States to help them design and implement randomized evaluations and use the evidence generated to inform their policy decisions.
And Ethical Systems' Jonathan Haidt talks about business ethics in a two-part video from a recent Aspen Ideas talk:
In Part 1 he makes the case that Buddha was right: On average, goodness flowers and mischief will bring a company to grief. http://ethicalsystems.org/content/AspenIdeas_part1
In Part 2 he talks about how the historical shift from stakeholder approaches to shareholder primacy, which became the dominant view in the 1980s, has led to ever-more-creative ways to squeeze all other stakeholders to maximize returns to shareholders, and outlines how ethical system design is the red pill for reducing inequality: http://ethicalsystems.org/content/AspenIdeas_part2
And lots more from twitter: