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October 17, 2008

STAWAR: Nudging ventured, nudging gained

A tremendous amount of effort is expended trying to get people to do things that are good for them. Many of us, however, lack the know-how or discipline when it comes to dealing effectively with challenges such as our health, finances, and the environment.

Whether it is fastening our seatbelts, conserving energy, or exercising more, people often resist doing the right thing. Two social scientists at the University of Chicago recently published a book entitled “Nudge: Improving Decisions About Health, Wealth, and Happiness” that addresses this phenomenon.

The authors Richard Thaler and Cass R. Sunstein suggests that positive change is best accomplished by the careful design of “choice architecture” (nudging) rather than by punishing undesirable behavior. By “choice architecture” they mean the way we arrange the settings where decisions are made. For example, product placement in stores greatly influences the selections that are made. Products at eye level have a much higher probability of selling, than those we have to stoop or tiptoe to see. That is why there is such a competition for desirable shelve space.

School lunchroom managers have similarly found that they can significantly decrease the number of desserts that children choose, simply by putting them at the end of the cafeteria line or placing them on a back row rather than right out front. Creating that need for tiny additional effort is what is meant by “nudging.”

Some people see nudging as outright manipulation, but Thaler and Sunstein believe that it is possible to help people make better choices while retaining our freedoms. Unapologetic about wanting to help people become healthier, wealthier, and wise, they subscribe to a philosophy called “libertarian paternalism.” In a nutshell they believe in pushing people towards the choices they would have made anyway, if only they had sufficient wisdom, insight, or willpower.

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