CRF Blog

Nudge comes to shove

by David De La Torre

In Nudge comes to shove, The Economist reports on how policymakers around the world are looking to behavioral economics.

In 2009 Barack Obama appointed Mr Sunstein as head of the White House’s Office of Information and Regulatory Affairs. The following year Mr Thaler advised Britain’s government when it established BIT [Behavioural Insights Team], which quickly became known as the “nudge unit”. If BIT did not save the government at least ten times its running cost (£500,000 a year), it was to be shut down after two years.

Not only did BIT stay open, saving about 20 times its running cost, but it marked the start of a global trend. Now many governments are turning to nudges to save money and do better. In 2014 the White House opened the Social and Behavioural Sciences Team. A report that year by Mark Whitehead of Aberystwyth University counted 51 countries in which “centrally directed policy initiatives” were influenced by behavioural sciences. Non-profit organisations such as Ideas42, set up in 2008 at Harvard University, help run dozens of nudge-style trials and programmes around the world. In 2015 the World Bank set up a group that is now applying behavioural sciences in 52 poor countries. The UN is turning to nudging to help hit the “sustainable development goals”, a list of targets it has set for 2030. [more]