Why Policymakers Should Be Transparent About the Behavioural Interventions They Use: A Systematic, Policy-Oriented Review

Abstract

Governments and public agencies use nudges to address policy issues. However, policymakers remain hesitant to implement them for fear of public backlash. A potential remedy is to administer nudges accompanied by a transparency message. However, many still think that transparency might decrease the effectiveness of nudges. Our systematic literature review of the effect of transparency on nudge perceptions and effectiveness suggests that such a reservation is largely unfounded. Fourteen articles provide 87 tests of transparency. We find a positive effect on nudge effectiveness in 33, no effect in 52, and a negative effect in only two cases. Based on a systematic categorization of different transparency components, we provide a more nuanced view on their distinct impact on nudge effectiveness. We find that disclosing the underlying mechanism of a nudge significantly boosts their effectiveness. We highlight and discuss relevant policy implications and suggest further research avenues. Our insights contribute to a better understanding of transparent nudging, thus informing policymakers and researchers alike.

Keywords: nudge, public policy, systematic review, transparency

JEL Classification: D04, D78