Can Nudges Be Transparent and Yet Effective?

47 Pages Posted: 1 Aug 2016 Last revised: 1 Mar 2018

See all articles by Hendrik Bruns

Hendrik Bruns

University of Hamburg - School of Business, Economics and Social Sciences

Elena Kantorowicz-Reznichenko

Erasmus University Rotterdam

Katharina Klement

University of Jena

Marijane Luistro Jonsson

Stockholm School of Economics

Bilel Rahali

Univ. Grenoble Alpes, CNRS, INRA, Grenoble INP, GAEL, 38000 Grenoble, France

Date Written: February 28, 2018

Abstract

Nudges receive growing attention as an effective concept to alter people's decisions without significantly changing economic incentives or limiting options. However, being often very subtle and covert, nudges are also criticized as unethical.By not being transparent about the intention to influence individual choice they might be perceived as limiting freedom of autonomous actions and decisions. So far, empirical research on this issue is scarce. In this study, we investigate whether nudges can be made transparent without limiting their effectiveness. For this purpose we conduct a laboratory experiment where we nudge contributions to carbon emission reduction by introducing a default value. We test how different types of transparency (i.e. knowledge of the potential influence of the default, its purpose, or both) influence the effect of the default. Our findings demonstrate that the default increases contributions, and information on the potential influence, its purpose, or both combined do not significantly influence the default effect. Furthermore, we do not find evidence that psychological reactance interacts with the influence of transparency. Findings support the policy-relevant claim that nudges (in the form of defaults) can be transparent and yet effective.

Keywords: climate protection, experiment, default, nudge, transparency, public good

JEL Classification: D03, H41, Q58, K23

Suggested Citation

Bruns, Hendrik and Kantorowicz-Reznichenko, Elena and Klement, Katharina and Luistro Jonsson, Marijane and Rahali, Bilel, Can Nudges Be Transparent and Yet Effective? (February 28, 2018). Journal of Economic Psychology, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2816227 or http://dx.doi.org/10.2139/ssrn.2816227

Hendrik Bruns (Contact Author)

University of Hamburg - School of Business, Economics and Social Sciences ( email )

Welckerstrasse 8
Hamburg, D-20354
Germany

Elena Kantorowicz-Reznichenko

Erasmus University Rotterdam ( email )

Zuid-Holland
Netherlands

Katharina Klement

University of Jena ( email )

Furstengraben 1
Jena, Thuringa 07743
Germany

Marijane Luistro Jonsson

Stockholm School of Economics ( email )

PO Box 6501
Stockholm, 11383
Sweden

Bilel Rahali

Univ. Grenoble Alpes, CNRS, INRA, Grenoble INP, GAEL, 38000 Grenoble, France ( email )

BP47
38040 Grenoble Cedex
France

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