Should Governments Invest More in Nudging?

33 Pages Posted: 8 Jun 2017  

Shlomo Benartzi

University of California at Los Angeles

John Beshears

Harvard Business School; National Bureau of Economic Research (NBER)

Katherine L. Milkman

University of Pennsylvania - The Wharton School

Cass R. Sunstein

Harvard Law School; Harvard University - Harvard Kennedy School (HKS)

Richard H. Thaler

University of Chicago - Booth School of Business; National Bureau of Economic Research (NBER)

Maya Shankar

Google Inc.

Will Tucker-Ray

ideas42

William Congdon

ideas42

Steven Galing

Government of the United States of America - Department of Defense

Date Written: June 6, 2017

Abstract

Governments are increasingly adopting behavioral science techniques for changing individual behavior in pursuit of policy objectives. The types of “nudge” interventions that governments are now adopting alter people’s decisions without resorting to coercion or significant changes to economic incentives. We calculate ratios of impact to cost for nudge interventions and for traditional policy tools, such as tax incentives and other financial inducements, and we find that nudge interventions often compare favorably to traditional interventions. We conclude that nudging is a valuable approach that should be used more in conjunction with traditional policies, but more relative effectiveness calculations are needed.

Keywords: nudge, nudge unit, choice architecture, behavioral science, behavioral economics, savings, pension plan, education, college enrollment, energy, electricity usage, preventive health, influenza vaccination, flu shot

Suggested Citation

Benartzi, Shlomo and Beshears, John and Milkman, Katherine L. and Sunstein, Cass R. and Thaler, Richard H. and Shankar, Maya and Tucker-Ray, Will and Congdon, William and Galing, Steven, Should Governments Invest More in Nudging? (June 6, 2017). Harvard Public Law Working Paper No. 17-42. Available at SSRN: https://ssrn.com/abstract=2982109 or http://dx.doi.org/10.2139/ssrn.2982109

Shlomo Benartzi

University of California at Los Angeles ( email )

D410 Anderson Complex
Los Angeles, CA 90095-1481
United States
310-206-9939 (Phone)
310-267-2193 (Fax)

John Beshears

Harvard Business School ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Katherine L. Milkman (Contact Author)

University of Pennsylvania - The Wharton School ( email )

Philadelphia, PA 19104
United States

Cass R. Sunstein

Harvard Law School ( email )

1575 Massachusetts Ave
Areeda Hall 225
Cambridge, MA 02138
United States
617-496-2291 (Phone)

Harvard University - Harvard Kennedy School (HKS) ( email )

79 John F. Kennedy Street
Cambridge, MA 02138
United States

Richard H. Thaler

University of Chicago - Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773-702-5208 (Phone)
773-702-0458 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Maya Shankar

Google Inc. ( email )

1600 Amphitheatre Parkway
Second Floor
Mountain View, CA 94043
United States

Will Tucker-Ray

ideas42 ( email )

80 Broad Street
Suite 3000
New York, NY 10004
United States

William Congdon

ideas42 ( email )

80 Broad Street
Suite 3000
New York, NY 10004
United States

Steven Galing

Government of the United States of America - Department of Defense ( email )

Arlington, VA 20301
United States

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