Behavioral Insights

The U.S. government is getting interested in influencing the behavior of citizens in a more direct way than information management.

England has a "Behavioral Insights Team." These guys devise subtle policies to change behavior. One such policy concerns how to get British citizens with late tax filings to pay up. "Sending letters to late taxpayers that indicated a social norm -- i.e., that '9 out of 10 people in Britain paid their taxes on time' -- resulted in a 15 percent increase in response rates over a three-month period, rolling out to £30 million of extra annual revenue," a U.S. document reviewing the program reads.

Such policies --encouraging behavior subtly rather than outright requiring it -- have come to be known as "nudges," after an influential 2008 book titled "Nudge," by former Obama regulatory czar Cass Sunstein and Chicago Booth School of Business professor Richard Thaler, popularized the term. Thaler, who is also an adviser to the British Behavioral Insights Team, said that his research also supports automatically enrolling people in retirement savings plans. "Many people have struggled to save enough to provide for an adequate retirement. ... Two simple design changes can dramatically improve the situation ... automatic enrollment (default people into the plan with the option to easily opt out) and automatic escalation, where workers can sign up to have their contributions increased annually," he said. Presumably this would run in parallel to the already remarkably successful Social Security experiment.

Harvard economics professor David Laibson, who studies behavioral economics and is in touch with the people in government setting up the program, says there are very real benefits to some "nudge" policies -- such as one that increases the number of people registered as organ donors by making people decide when they apply for a drivers' license. There is no suggestion yet to incorporate subliminal suggestion.

There is a risk in government influencing social (as opposed to criminal) behavior. The government is always coming up with their own norms and encouraging them since they know so much better than we do. When these passive/aggressive approaches fail it is necessary to criminalize them. The teaching of evolution, sodomy laws, gambling and alcohol regulation, Sunday Blue Laws, trans-fats bans are all social behaviors made criminal when social pressure was seen as insufficient.

But one can have confidence in the vision and caution of this government; after all, they taught us how to sneeze.