Message and Environment: A Framework for Nudges and Choice Architecture

Abstract

We argue that the diverse components of a choice architecture can be classified into two main dimensions – Message and Environment – and that the distinction between them is useful to better understand how nudges work. In the first part of the paper, we define what we mean by nudge, explain what Message and Environment are, argue that the distinction between them is conceptually robust, and show that it is also orthogonal to other distinctions advanced in the nudge literature. In the second part, we review some common types of nudges, and show they target either Message, or Environment, or both dimensions of the choice architecture. We then apply the Message–Environment framework to discuss some features of Amazon’s website and, finally, we indicate how the proposed framework could help a choice architect to design a new choice architecture.

Keywords: Message, Environment, Nudge, Choice architecture, Rationality failures, Behavioural Economics

JEL Classification: B40, D90, E70, G40, M30