Challenge: Happy Birthday nudge!

By Pelle Guldborg Hansen

I don't think that my sister have ever paid serious attention to anything I've said in my life.

Not until last Sunday at my niece's Birthday, that is.

The birthday nudge
My sister works with the Danish Cancer Society - the same organization (but different section) that we are working with through the Danish Nudging Network. Although I've once told her about nudging, I guess it's there that she has picked up some ideas.

Thus, last Sunday at my niece's Birthday party, my sister suddenly makes the announcement at the table that she has made a little nudge-experiment.

What nobody had noticed was that there were two different varieties of Birthday buns served in each their basket: one variety with sugar, one variety without. Ultimately nobody had noticed, and thus the result was that 50% less sugar was eaten, since pick of bread basket was more or less random (my sister switched bread baskets once in a while during the party).

Is it a nudge?
Whether this is a nudge depends on a few decisions. Thaler and Sunstein's definition of a nudge doesn't say explicitly whether adding a choice-option rules out a nudge. Thus one has to go to the background theory of behavioral economics to get it right. According to this, adding an option is a nudge if it influences real world behavior, but leaves the ideal agent of homo economicus unaffected.  

Ultimately, the Birthday buns manage the fundamental requirements. Adding a sugarless variety of buns left the standard singleton-choice of buns with sugar feasible. Also, there were no cost-benefit adjustment attached in any way to the intervention - not even of the social kind, since my sister didn't inform us about the addition of a new choice.

Rational Birthday party challenge
But the decisive question is: would an ideal agent be influenced by the addition of a choice?

Well, on the one hand he wouldn't have any information about the sugarless variety to begin with. That seems to leave a Birthday party of rational agents to end up with eating 50% less sugar given their imperfect information and the assumption that choice of bread basket is made at random.  

But is this the right baseline to compare observed effect with when evaluating whether the intervention ultimately qualifies as a nugde?

I want to pose this as a challenge to you readers out there: is the Birthday Bun Nudge, really a nugde?

Clues
I'll provide my answer later on. For now, I leave you with the following clues.

(1) Ideal decision makers have taste-buds just like everyone else, but they also have perfect recall.
(2) At the rational birthday party ideal decision makers have imperfect information, but are also capable of learning.
(3) People did not eat the same number of Birthday buns. Some ate 1, most ate 2 or 3, and a few ate 4.
(4) My sister was willing to answer any question honestly.

Why nudging is better than the fat tax and other tools of the trade

By Andreas Maaløe Jespersen & Pelle Guldborg Hansen

"We do not first see, then define,
we define first and then we see."
              - Walter Lippmann (cited in Plous 1993)

Taxation and regulation are the traditional tools of the trade in policy-making. Thus, we've just seen here in Denmark how policy-makers have tried to prevent people from eating unhealthy foods: the fat tax. 


But honestly, in the months that have past we are yet to actually observe someone saying "ooohh, my Danish pastry costs 9 cents more than a couple of months ago. I better cut down!" Is someone actually expecting this tax to change behavior? We doubt it, but let's play along.  


Tools of the trade
What the fat tax seems to confirm is the old saying: "If all you have is a hammer, everything looks like a nail." (and additionally: if everyone expect you to use a hammer, they'll accept it, no matter how stupid the idea). 

credit to africa

In our jurney outside of Academia we've started to learn that this not only holds true in research, but also in the worlds of policy-making, marketing and advertisement as well. Seeking to influence behavior, policy-makers readilly opt for taxation and regulation, doctores opt for medicine, intellectuals opt for talking and teaching, and the advertising and marketing industry opt for hillariously expensive campaigns featuring material or events with half-naked women or celebreties (and often cutting expenses by finding someone who is both). 


We've also been confirmed in our belief that when policy-makers learn that their attempts to influence behavior by taxation and regulation fails, or when they find these meaures to be too invasive, they have for a long time turned to the advertisement and marketing industry - perhaps because it seems to be the most fun alternative. 


Measuring success
Yet, how is success usually measured in these branches? Well, the success of a new tax often seems to be measured by the tax collected, talk and teaching by the number of people who listens, and advertisements by the number of people who remembers to have seen the half-naked celebrety. 


The most recent plague in this business seems to the success meassured by the number of people signing up to a facebook group, or the number of people that have clicked a video on youtube - after all, numbers are objective, right?


However, notice that none of these approaches actually measures behaviour change! 


Self-fulfilling prophecies
When the rare occassion do happen and impact is actually measured on behavior or parameters closely associated with this, the tools of the trade are often given a biased evaluation. When these tools are seen to work (even the slightest), it is usually taken to confirm that we are using the right tools, but when they don't, it is just taken to confirm that we have not applied them with enough force. In sum: raise the taxes, harsher punishment, more information, more education, and more... well, half-naked celebreties.


Depending on one's point of view, this may be seen as (1) a reaction to sunk costs based on loss-aversion, (2) a reaction to the cognitive dissonance arising from being wrong, while at the same time believing oneself to be flawless, or (3) confirmation bias.

However, the most interesting reaction are the rare occasion where the tools of the trade are recognized to fail. In these cases, the people responsible for the behavior targeted are blamed.  Had they just been super-rational economic beings - as we all would like to be - they would have reacted in the way intended and according to their own interests. They're to blame! Not us!


Nudge
Readers of this blog will know that Nudge offers a different set of tools aimed at influencing the same behavior as usually targeted by the tools of the trade. However, it is important that we remember not to make the same mistake as the more "experienced players" in the game of behavioral change. 

Thus, it is important to remember that the nudge-doctrine is not a catch-all strategy that completely wipes out the need for more traditional policy measures (a). Nor does signs of success imply with necessity that we should always be restricted to keeping within the nudge-doctrine. There might be cases where stronger interventions are needed.

Instead Nudge should be seen as an addition to the already existing toolbox.

Still, the nudge-doctrine does possess one strict advantage over other tools of the trade. It expands the perception of what is constitutive of the behavior targeted and requires a good account of this behavior.

When we fail, we're to blame - not them.