This blog post, provided by the IPR Behavioral Insights Research Center and written by Dr. Terry Flynn and Tim Li, is based on a research paper by Schlomo Benartzi, John Beshears, Katherine Milkman, Cass Sunstein, Richard Thaler, Maya Shankar, and Steven Galing. 

Key Findings

  • Nudges are strategies that guide decision-making toward a particular direction
  • Nudges can be more cost-efficient at changing behaviour than traditional interventions, like educational communications and financial incentives.
  • Government organizations have found success in using nudges for encouraging retirement savings, college enrollment, energy conservation, and vaccinations.

Implications for Public Relations

The success of nudges in government and policy demonstrates their effectiveness across multiple domains. Nudges and other insights from behavioural sciences research are useful tools for public relations professionals to consider in their work. It is important to recognize that human behaviour is often irrational because it relies on unconscious mental shortcuts rather than a careful evaluation of information. These short cuts or “heuristics” are essential as they allow for quick decision-making and help preserve our cognitive energy. However, they can go awry and lead to behaviours that don’t align with our attitudes, beliefs, or goals.

Summary

Nudges are interventions that are designed to predictably change behaviour without violating people’s autonomy. They are based on behavioural science principles like the notion that people often make decisions based on intuition and mental shortcuts, instead of careful, rational evaluations of the available information. Governments are starting to recognize the potential of nudges to promote positive behaviours and have formed specialized units for developing and implementing nudges.

This study evaluated the impact of nudges from various government nudge units, and whether they were cost-effective. The nudges examined targeted a wide range of policy issues including retirement savings, education, energy use, health, job training, program compliance, and security.

The authors compared the interventions using ratios between impact and cost. Across all of the policy issues examined, nudges considerably outperformed traditional communications or financial incentives.

Having new employees set how much money is contributed to retirement savings within their first month was more effective than traditional incentive strategies like matching contributions and tax credits. The active decision prevented procrastination and defaulting to a zero contribution rate.

Similarly, financial incentives for college enrollment like stipends and subsidies for students were not as efficient as having tax professionals assist families with preparing taxes and financial aid applications. This personalized assistance nudge reduced anxiety and procrastination for filling forms and drew attention to college applications.

Nudges can leverage our instinct to take cues from other’s behaviour and conform to social norms. Informing residential consumers about how their electricity consumption compared with others in their neighbourhood was more effective per dollar spent than financial incentives and education initiatives at reducing energy use.

Implementation nudges encourage people to set intentions for behaviours, which help with planning, memory, and commitment. A review of flu shot promotion interventions revealed that having people write down their plan to obtain flu shots was more successful than traditional approaches.

Blog post compiled by Dr. Terry Flynn and Tim Li. 

Citation
Benartzi, Shlomo, Beshears, John, Milkman, Katherine. L., Sunstein, Cass R., Thaler, Richard H., Shankar, Maya, Galing, Steven, et al. (2017). Should governments invest more in nudging?. Psychological Science, 28(8), 1041-1055. https://doi.org/10.1177/0956797617702501

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Heidy Modarelli handles Growth & Marketing for IPR. She has previously written for Entrepreneur, TechCrunch, The Next Web, and VentureBeat.
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