Europe

Nudging – Possibilities, Limitations and Applications in European Law and Economics

Curated on May 24, 2016August 3, 2018 by Stefaan Verhulst

Book edited by Mathis, Klaus and Tor, Avishalom: “This anthology provides an in-depth analysis and discusses the issues surrounding nudging and its use in legislation, regulation, and policy making more generally. The 17 essays in this anthology provide startling insights into the multifaceted debate surrounding the use of nudges in European Law and Economics.

Nudging is a tool aimed at altering people’s behaviour in a predictable way without forbidding any option or significantly changing economic incentives. It can be used to help people make better decisions to influence human behaviour without forcing them because they can opt out. Its use has sparked lively debates in academia as well as in the public sphere. This book explores who decides which behaviour is desired. It looks at whether or not the state has sufficient information for debiasing, and if there are clear-cut boundaries between paternalism, manipulation and indoctrination. The first part of this anthology discusses the foundations of nudging theory and the problems associated, as well as outlining possible solutions to the problems raised. The second part is devoted to the wide scope of applications of nudges from contract law, tax law and health claim regulations, among others.

This volume is a result of the flourishing annual Law and Economics Conference held at the law faculty of the University of Lucerne. The conferences have been instrumental in establishing a strong and ever-growing Law and Economics movement in Europe, providing unique insights in the challenges faced by Law and Economics when applied in European legal traditions….(More)”

Moneyballing Criminal Justice

Curated on May 22, 2016November 14, 2018 by Stefaan Verhulst

Anne Milgram in the Atlantic: “…One area in which the potential of data analysis is still not adequately realized,however, is criminal justice. This is somewhat surprising given the success of CompStat, a law enforcement management tool that uses data to figure out how police resources can be used to reduce crime and hold law enforcement officials accountable for results. CompStat is widely credited with contributing to New York City’s dramatic reduction in serious crime over the past two decades. Yet data-driven decision-making has not expanded to the whole of the criminal justice system.

But it could. And, in this respect, the front end of the system — the part of the process that runs from arrest through sentencing — is particularly important. Atthis stage, police, prosecutors, defenders, and courts make key choices about how to deal with offenders — choices that, taken together, have an enormous impact on crime. Yet most jurisdictions do not collect or analyze the data necessary to know whether these decisions are being made in a way that accomplishes the most important goals of the criminal justice system: increased public safety,decreased recidivism, reduced cost, and the fair, efficient administration of justice.

Even in jurisdictions where good data exists, a lack of technology is often an obstacle to using it effectively. Police, jails, courts, district attorneys, and public defenders each keep separate information systems, the data from which is almost never pulled together and analyzed in a way that could answer the questions that matter most: Who is in our criminal justice system? What crimes have been charged? What risks do individual offenders pose? And which option would best protect the public and make the best use of our limited resources?

While debates about prison over-crowding, three strikes laws, and mandatory minimum sentences have captured public attention, the importance of what happens between arrest and sentencing has gone largely unnoticed. Even though I ran the criminal justice system in New Jersey, one of the largest states in the country, I had not realized the magnitude of the pretrial issues until I was tasked by theLaura and John Arnold Foundation with figuring out which aspects of criminal justice had the most need and presented the greatest opportunity for reform….

Technology could help us leverage data to identify offenders who will pose unacceptable risks to society if they are not behind bars and distinguish them from those defendants who will have lower recidivism rates if they are supervised in the community or given alternatives to incarceration before trial. Likewise, it could help us figure out which terms of imprisonment, alternatives to incarceration, and other interventions work best–and for whom. And the list does not end there.

The truth is our criminal justice system already makes these decisions every day.But it makes them without knowing whether they’re the right ones. That needs to change. If data is powerful enough to transform baseball, health care, and education, it can do the same for criminal justice….(More)”

…(More).

BeMyEye: Crowdsourcing is making it easier to gather data fast

Curated on May 21, 2016August 3, 2018 by Stefaan Verhulst

Jack Torrance at Management Today: “The era of big data is upon us. Dozens of well-funded start-ups have sprung up of late claiming to be able to turn raw data into ‘actionable insights’ that would have been unimaginable a few years ago. But the process of actually collecting data is still not always straightforward….

London-based start-up BeMyEye (not to be confused with Be My Eyes, an iPhone app that claims to ‘help the blind see’) has built an army of casual data gatherers that report back via their phones. ‘For companies that sell their product to high street retailers or supermarkets, being able to verify the presence of their product, the adequacy of the promotions, the positioning in relation to competitors, this is all invaluable intelligence,’ CEO Luca Pagano tells MT. ‘Our crowd is able to observe and feed this information back to these brands very, very quickly.’…

They can do more than check prices in shops. Some of its clients (which include Heineken, Illy and Three) have used the service to check billboards they are paying for have actually been put up correctly. ‘We realised the level of [billboard] compliance is actually below 90%,’ says Pagano. It can also be used to generate sales leads….

BeMyEyes isn’t the only company that’s exploring this business model. San Francisco company Premise is using a similar network of data gatherers to monitor food prices and other metrics in developing countries for NGOs and governments as well as commercial organisations. It’s not hard to see why they would be an attractive proposition for clients, but the challenge for both of these businesses will be ensuring they can find enough reliable and effective data gatherers to keep the information flowing in at a high enough quality….(More)”

Building Data Responsibility into Humanitarian Action

Curated on May 19, 2016August 3, 2018 by Stefaan Verhulst

Stefaan Verhulst at The GovLab: “Next Monday, May 23^rd, governments, non-profit organizations and citizen groups will gather in Istanbul at the first World Humanitarian Summit. A range of important issues will be on the agenda, not least of which the refugee crisis confronting the Middle East and Europe. Also on the agenda will be an issue of growing importance and relevance, even if it does not generate front-page headlines: the increasing potential (and use) of data in the humanitarian context.

To explore this topic, a new paper, “Building Data Responsibility into Humanitarian Action,” is being released today, and will be presented tomorrow at the Understanding Risk Forum. This paper is the result of a collaboration between the United Nations Office for the Coordination of Humanitarian Affairs (OCHA), The GovLab (NYU Tandon School of Engineering), the Harvard Humanitarian Initiative, and Leiden UniversityCentre for Innovation. It seeks to identify the potential benefits and risks of using data in the humanitarian context, and begins to outline an initial framework for the responsible use of data in humanitarian settings.

Both anecdotal and more rigorously researched evidence points to the growing use of data to address a variety of humanitarian crises. The paper discusses a number of data risk case studies, including the use of call data to fight Malaria in Africa; satellite imagery to identify security threats on the border between Sudan and South Sudan; and transaction data to increase the efficiency of food delivery in Lebanon. These early examples (along with a few others discussed in the paper) have begun to show the opportunities offered by data and information. More importantly, they also help us better understand the risks, including and especially those posed to privacy and security.

One of the broader goals of the paper is to integrate the specific and the theoretical, in the process building a bridge between the deep, contextual knowledge offered by initiatives like those discussed above and the broader needs of the humanitarian community. To that end, the paper builds on its discussion of case studies to begin establishing a framework for the responsible use of data in humanitarian contexts. It identifies four “Minimum Humanitarian standards for the Responsible use of Data” and four “Characteristics of Humanitarian Organizations that use Data Responsibly.” Together, these eight attributes can serve as a roadmap or blueprint for humanitarian groups seeking to use data. In addition, the paper also provides a four-step practical guide for a data responsibility framework (see also earlier blog)….(More)” Full Paper: Building Data Responsibility into Humanitarian Action

Twelve principles for open innovation 2.0

Curated on May 18, 2016August 3, 2018 by Stefaan Verhulst

Martin Curley in Nature: “A new mode of innovation is emerging that blurs the lines between universities, industry, governments and communities. It exploits disruptive technologies — such as cloud computing, the Internet of Things and big data — to solve societal challenges sustainably and profitably, and more quickly and ably than before. It is called open innovation 2.0 (ref. 1).

Such innovations are being tested in ‘living labs’ in hundreds of cities. In Dublin, for example, the city council has partnered with my company, the technology firm Intel (of which I am a vice-president), to install a pilot network of sensors to improve flood management by measuring local rain fall and river levels, and detecting blocked drains. Eindhoven in the Netherlands is working with electronics firm Philips and others to develop intelligent street lighting. Communications-technology firm Ericsson, the KTH Royal Institute of Technology, IBM and others are collaborating to test self-driving buses in Kista, Sweden.

Yet many institutions and companies remain unaware of this radical shift. They often confuse invention and innovation. Invention is the creation of a technology or method. Innovation concerns the use of that technology or method to create value. The agile approaches needed for open innovation 2.0 conflict with the ‘command and control’ organizations of the industrial age (see ‘How innovation modes have evolved’). Institutional or societal cultures can inhibit user and citizen involvement. Intellectual-property (IP) models may inhibit collaboration. Government funders can stifle the emergence of ideas by requiring that detailed descriptions of proposed work are specified before research can begin. Measures of success, such as citations, discount innovation and impact. Policymaking lags behind the market place….

Keys to collaborative innovation

Purpose. Efforts and intellects aligned through commitment rather than compliance deliver an impact greater than the sum of their parts. A great example is former US President John F. Kennedy’s vision of putting a man on the Moon. Articulating a shared value that can be created is important. A win–win scenario is more sustainable than a win–lose outcome.
Partner. The ‘quadruple helix’ of government, industry, academia and citizens joining forces aligns goals, amplifies resources, attenuates risk and accelerates progress. A collaboration between Intel, University College London, Imperial College London and Innovate UK’s Future Cities Catapult is working in the Intel Collaborative Research Institute to improve people’s well-being in cities, for example to enable reduction of air pollution.
Platform. An environment for collaboration is a basic requirement. Platforms should be integrated and modular, allowing a plug-and-play approach. They must be open to ensure low barriers to use, catalysing the evolution of a community. Challenges in security, standards, trust and privacy need to be addressed. For example, the Open Connectivity Foundation is securing interoperability for the Internet of Things.
Possibilities. Returns may not come from a product but from the business model that enabled it, a better process or a new user experience. Strategic tools are available, such as industrial designer Larry Keeley’s breakdown of innovations into ten types in four categories: finance, process, offerings and delivery.
Plan. Adoption and scale should be the focus of innovation efforts, not product creation. Around 20% of value is created when an innovation is established; more than 80% comes when it is widely adopted⁷. Focus on the ‘four Us’: utility (value to the user); usability; user experience; and ubiquity (designing in network effects).
Pyramid. Enable users to drive innovation. They inspired two-thirds of innovations in semiconductors and printed circuit boards, for example. Lego Ideas encourages children and others to submit product proposals — submitters must get 10,000 supporters for their idea to be reviewed. Successful inventors get 1% of royalties.
Problem. Most innovations come from a stated need. Ethnographic research with users, customers or the environment can identify problems and support brainstorming of solutions. Create a road map to ensure the shortest path to a solution.
Prototype. Solutions need to be tested and improved through rapid experimentation with users and citizens. Prototyping shows how applicable a solution is, reduces the risks of failures and can reveal pain points. ‘Hackathons’, where developers come together to rapidly try things, are increasingly common.
Pilot. Projects need to be implemented in the real world on small scales first. The Intel Collaborative Research Institute runs research projects in London’s parks, neighbourhoods and schools. Barcelona’s Laboratori — which involves the quadruple helix — is pioneering open ‘living lab’ methods in the city to boost culture, knowledge, creativity and innovation.
Product. Prototypes need to be converted into viable commercial products or services through scaling up and new infrastructure globally. Cloud computing allows even small start-ups to scale with volume, velocity and resilience.
Product service systems. Organizations need to move from just delivering products to also delivering related services that improve sustainability as well as profitability. Rolls-Royce sells ‘power by the hour’ — hours of flight time rather than jet engines — enabled by advanced telemetry. The ultimate goal of open innovation 2.0 is a circular or performance economy, focused on services and reuse rather than consumption and waste.
Process. Innovation is a team sport. Organizations, ecosystems and communities should measure, manage and improve their innovation processes to deliver results that are predictable, probable and profitable. Agile methods supported by automation shorten the time from idea to implementation….(More)”

Big data’s ‘streetlight effect’: where and how we look affects what we see

Curated on May 17, 2016July 19, 2019 by Stefaan Verhulst

Mark Moritz at the Conversation: “Big data offers us a window on the world. But large and easily available datasets may not show us the world we live in. For instance, epidemiological models of the recent Ebola epidemic in West Africa using big data consistently overestimated the risk of the disease’s spread and underestimated the local initiatives that played a critical role in controlling the outbreak.

Researchers are rightly excited about the possibilities offered by the availability of enormous amounts of computerized data. But there’s reason to stand back for a minute to consider what exactly this treasure trove of information really offers. Ethnographers like me use a cross-cultural approach when we collect our data because family, marriage and household mean different things in different contexts. This approach informs how I think about big data.

We’ve all heard the joke about the drunk who is asked why he is searching for his lost wallet under the streetlight, rather than where he thinks he dropped it. “Because the light is better here,” he said.

This “streetlight effect” is the tendency of researchers to study what is easy to study. I use this story in my course on Research Design and Ethnographic Methods to explain why so much research on disparities in educational outcomes is done in classrooms and not in students’ homes. Children are much easier to study at school than in their homes, even though many studies show that knowing what happens outside the classroom is important. Nevertheless, schools will continue to be the focus of most research because they generate big data and homes don’t.

The streetlight effect is one factor that prevents big data studies from being useful in the real world – especially studies analyzing easily available user-generated data from the Internet. Researchers assume that this data offers a window into reality. It doesn’t necessarily.

Looking at WEIRDOs

Based on the number of tweets following Hurricane Sandy, for example, it might seem as if the storm hit Manhattan the hardest, not the New Jersey shore. Another example: the since-retired Google Flu Trends, which in 2013 tracked online searches relating to flu symptoms to predict doctor visits, but gave estimates twice as high as reports from the Centers for Disease Control and Prevention. Without checking facts on the ground, researchers may fool themselves into thinking that their big data models accurately represent the world they aim to study.

The problem is similar to the “WEIRD” issue in many research studies. Harvard professor Joseph Henrich and colleagues have shown that findings based on research conducted with undergraduates at American universities – whom they describe as “some of the most psychologically unusual people on Earth” – apply only to that population and cannot be used to make any claims about other human populations, including other Americans. Unlike the typical research subject in psychology studies, they argue, most people in the world are not from Western, Educated, Industrialized, Rich and Democratic societies, i.e., WEIRD.

Twitter users are also atypical compared with the rest of humanity, giving rise to what our postdoctoral researcher Sarah Laborde has dubbed the “WEIRDO” problem of data analytics: most people are not Western, Educated, Industrialized, Rich, Democratic and Online.

Context is critical

Understanding the differences between the vast majority of humanity and that small subset of people whose activities are captured in big data sets is critical to correct analysis of the data. Considering the context and meaning of data – not just the data itself – is a key feature of ethnographic research, argues Michael Agar, who has written extensively about how ethnographers come to understand the world….(https://theconversation.com/big-datas-streetlight-effect-where-and-how-we-look-affects-what-we-see-58122More)”

On Iceland’s Crowdsourced Constitution

Curated on May 14, 2016August 3, 2018 by Stefaan Verhulst

Larry Lessig: “In the history of constitutions across the world, America has had a unique place: Ours was the first constitution ratified by the people in convention. But Iceland has now done something much more significant: For the first time in the history of the world, and using a technology only possible in the21st century, the people of a nation have crafted their own constitution through an open and inclusive crowd-sourcing process. Yet astonishingly,that constitution remains unenforced.

As everyone in [Iceland] knows, after the financial disasters of 2008, the citizens of Iceland began a process to claim back their own sovereignty.Building on the values identified by 1,000 randomly selected citizens,Icelanders launched a process to crowdsource a new constitution. That initiative was then ratified when the Parliament established a procedure for selecting delegates to a drafting commission. More than 500 citizens ran to serve on that 25 person commission. Over four months, the commissioners met to draft a constitution, with their work made available for public comment throughout the process. More than 3600 comments were offered by the public, leading to scores of modifications. The final draft, adopted unanimously, was then sent to the parliament and to the people. More than2/3ds of voters endorsed the document in a non-binding referendum as the basis of a new constitution.

Never in the history of constitutionalism has anything like this ever been done. If democracy is rule by the people — if the sovereignty of a democratic nation is ultimately the people — then this process and the constitution it produced is as authentic and binding as any in the world. Yet the parliament of Iceland has refused to allow this constitution to go into effect. And the question that anyone in the movements for democracy across the world must ask is just this: By what right?

No doubt, the procedure for crafting and ultimately ratifying the constitution included as the final step Parliament’s sanction — just as the procedure for selecting a government in Britain is subject ultimately to theQueen’s sanction. But the Queen understands the limited power that right conveys — if Britain is to call itself a democracy. And the same is true ofIceland. When the people have acted as they have here — by crafting a constitution in the most inclusive and reflective way that has ever, in the history of constitutionalism, happened, and then endorsed that work by a popular vote, by what moral authority does the Parliament now say no? No doubt, there are parts of the constitution that some don’t like. But democracy is not a promise of perfection. And no constitution in the history of the world has ever been loved by everyone it affected — just ask the million African slaves whose freedom was made unconstitutional through1808 by America’s popularly ratified constitution.

The question for Iceland is, who is sovereign? Is it the people or is it not?And if it is the people, will the people demand that their will be respected?…(More)”

Workplace innovation in the public sector

Curated on May 11, 2016August 15, 2018 by Stefaan Verhulst

Eurofound: “Innovative organisational practices in the workplace, which aim to make best use of human capital, are traditionally associated with the private sector. The nature of the public sector activities makes it more difficult to identify these types of internal innovation in publicly funded organisations.

It is widely thought that public sector organisations are neither dynamic nor creative and are typified by a high degree of inertia. Yet the necessity of innovation ought not to be dismissed. The public sector represents a quarter of total EU employment, and it is of critical importance as a provider and regulator of services. Improving how it performs has a knock-on effect not only for private sector growth but also for citizens’ satisfaction. Ultimately, this improves governance itself.

So how can innovative organisation practices help in dealing with the challenges faced by the public sector? Eurofound, as part of a project on workplace innovation in European companies, carried out case studies of both private and public sector organisations. The findings show a number of interesting practices and processes used.

Employee participation

The case studies from the public sector, some of which are described below, demonstrate the central role of employee participation in the implementation of workplace innovation and its impacts on organisation and employees. They indicate that innovative practices have resulted in enhanced organisational performance and quality of working life.

It is widely thought that changes in the public sector are initiated as a response to government policies. This is often true, but workplace innovation may also be introduced as a result of well-designed initiatives driven by external pressures (such as the need for a more competitive public service) or internal pressures (such as a need to update the skills map to better serve the public).

Case study findings

The state-owned Lithuanian energy company Lietuvos Energijos Gamyba (140 KB PDF) encourages employee participation by providing a structured framework for all employees to propose improvements. This has required a change in managerial approach and has spread a sense of ownership horizontally and vertically in the company. The Polish public transport company Jarosław City Transport (191 KB PDF), when faced with serious financial stability challenges, as well as implementing operational changes, set up ways for employees’ voices to be heard, which enabled a contributory dialogue and strengthened partnerships. Consultation, development of mutual trust, and common involvement ensured an effective combination of top-down and bottom-up initiatives.

The Lithuanian Post, AB Lietuvos Pastas (136 KB PDF) experienced a major organisation transformation in 2010 to improve efficiency and quality of service. Through a programme of ‘Loyalty day’ monthly visits, both top and middle management of the central administration visit any part of the company and work with colleagues in other units. Under budgetary pressure to ‘earn their money’, the Danish Vej and Park Bornholm (142 KB PDF) construction services in roads, parks and forests had to find innovative solutions to deal with a merger and privatisation. Their intervention had the characteristics of workplace partnership with a new set of organisational values set from the bottom up. Self-managing teams are essential for the operation of the company.

The world of education has provided new structures that provide better outcomes for students. The South West University of Bulgaria (214 KB PDF) also operates small self-managing teams responsible for employee scheduling. Weekly round-tables encourage participation in collectively finding solutions, creating a more effective environment in which to respond to the competitive demands of education provision.

In Poland, an initiative by the Pomeranian Library (185 KB PDF) improved employee–management dialogue and communication through increased participation. The initiative is a response to the new frameworks for open access to knowledge for users, with the library mirroring the user experience through its own work practices.

Through new dialogue, government advisory bodies have also developed employee-led improvement. Breaking away from a traditional hierarchy is considered important in achieving a more flexible work organisation. Under considerable pressure, the top-heavy management of the British Geological Survey (89 KB PDF) now operates a flexible matrix that promotes innovative and entrepreneurial ways of working. And in Germany, Niersverband (138 KB PDF), a publicly owned water-management company innovated through training, learning, reflection partnerships and workplace partnerships. New occupational profiles were developed to meet external demands. Based on dialogue concerning workplace experiences and competences, employees acquired new qualifications that allowed the company to be more competitive.

In the Funen Village Museum in Odense, Denmark, (143 KB PDF) innovation came about at the request of staff looking for more flexibility in how they work. Formerly most of their work was maintenance tasks, but now they can now engage more with visitors. Control of schedules has moved to the team rather than being the responsibility of a single manager. As a result, museum employees are now hosts as well as craftspeople. They no longer feel ‘forgotten’ and are happier in their work….(More)”

The report Workplace innovation in European companies provides a full analysis of the case studies.

The 51 case studies and the list of companies (PDF 119 KB) the case studies are based on are available for download.

Fifty Shades of Open

Curated on May 10, 2016August 3, 2018 by Stefaan Verhulst

Jeffrey Pomerantz and Robin Peek at First Monday: “Open source. Open access. Open society. Open knowledge. Open government. Even open food. Until quite recently, the word “open” had a fairly constant meaning. The over-use of the word “open” has led to its meaning becoming increasingly ambiguous. This presents a critical problem for this important word, as ambiguity leads to misinterpretation.

“Open” has been applied to a wide variety of words to create new terms, some of which make sense, and some not so much. When we started writing this essay, we thought our working title was simply amusing. But the working title became the actual title, as we found that there are at least 50 different terms in which the word “open” is used, encompassing nearly as many different criteria for openness. In this essay we will attempt to make sense of this open season on the word “open.”

Opening the door on open

The word “open” is, perhaps unsurprisingly, a very old one in the English language, harking back to Early Old English. Unlike some words in English, the definition of “open” has changed very little in the intervening thousand-plus years: the earliest recorded uses of the word are completely consistent with its modern usage as an adjective, indicating a passage through or an access into something (Oxford English Dictionary, 2016).

This meaning leads to the development in the fifteenth century of the phrases “open house,” meaning an establishment in which all are welcome, and “open air,” meaning unenclosed outdoor spaces. One such unenclosed outdoor space that figured large in the fifteenth century, and continues to do so today, is the Commons (Hardin, 1968): land or other resources that are not privately owned, but are available for use to all members of a community. The word “open” in these phrases indicates that all have access to a shared resource. All are welcome to visit an open house, but not to move in; all are welcome to walk in the open air or graze their sheep on the Commons, but not to fence the Commons as part of their backyard. (And the moment at which Commons land ceases to be open is precisely the moment it is fenced by an owner, which is in fact what happened in Great Britain during the Enclosure movement of the sixteenth through eighteenth centuries.)

Running against the grain of this cultural movement to enclosure, the nineteenth century saw the circulating library become the norm — rather than libraries in which massive tomes were literally chained to desks. The interpretation of the word “open” to mean a shared resource to which all had access, fit neatly into the philosophy of the modern library movement of the nineteenth century. The phrases “open shelves” and “open stacks” emerged at this time, referring to resources that were directly available to library users, without necessarily requiring intervention by a librarian. Naturally, however, not all library resources were made openly available, nor are they even today. Furthermore, resources are made openly available with the understanding that, like Commons land, they must be shared: library resources have a due date.

The twentieth century saw an increase in the use of the word “open,” as well as a hint of the confusion that was to come about the interpretation of the word. The term “open society” was coined prior to World War I, to indicate a society tolerant of religious diversity. The “open skies” policy enables a nation to allow other nations’ commercial aviation to fly through its airspace — though, importantly, without giving up control of its airspace. The Open University was founded in the United Kingdom in 1969, to provide a university education to all, with no formal entry requirements. The meaning of the word “open” is quite different across these three terms — or perhaps it would be more accurate to say that these terms use different shadings of the word.

But it has been the twenty-first century that has seen the most dramatic increase in the number of terms that use “open.” The story of this explosion in the use of the word “open” begins, however, with a different word entirely: the word “free.”….

Introduction
Opening the door on open
Speech, beer, and puppies
Open means rights
Open means access
Open means use
Open means transparent
Open means participatory
Open means enabling openness
Open means philosophically aligned with open principles
Openwashing and its discontents
Conclusion“

Is behavioural economics ready to save the world?

Curated on May 10, 2016October 10, 2018 by Stefaan Verhulst

Book review by Trenton G Smith of Behavioral Economics and Public Health : “Modern medicine has long doled out helpful advice to ailing patients about not only drug treatments, but also diet, exercise, alcohol abuse, and many other lifestyle decisions. And for just as long, patients have been failing to follow doctors’ orders. Many of today’s most pressing public health problems would disappear if people would just make better choices.

Enter behavioural economics. A fairly recent offshoot of the dismal science, behavioural economics aims to take the coldly rational decision makers who normally populate economic theories, and instil in them a host of human foibles. Neoclassical (ie, conventional) economics, after all is the study of optimising behaviour in the presence of material constraints—why not add constraints on cognitive capacity, or self-control, or susceptibility to the formation of bad habits? The hope is that by incorporating insights from other behavioural sciences (most notably cognitive psychology and neuroscience) while retaining the methodological rigour of neoclassical economics, behavioural economics will yield a more richly descriptive theory of human behaviour, and generate new and important insights to better inform public policy.

Policy makers have taken notice. In an era in which free-market rhetoric dominates the political landscape, the idea that small changes to public health policies might serve to nudge consumers towards healthier behaviours holds great appeal. Even though some (irrational) consumers might be better off, the argument goes, if certain unhealthy food products were banned (or worse, taxed), this approach would infringe on the rights of the many consumers who want to indulge occasionally, and fully understand the consequences. If governments could instead use evidence from consumer science to make food labels more effective, or to improve the way that healthy foods are presented in school cafeterias, more politically unpalatable interventions in the marketplace might not be needed. This idea, dubbed “libertarian paternalism” by Richard Thaler and Cass Sunstein, has been pursued with gusto in both the UK (David Cameron’s Government formed the Behavioural Insights Team—unofficially described as the Nudge Unit) and the USA (where Sunstein spent time in the Obama administration’s Office of Information and Regulatory Affairs).

Whatever public health practitioners might think about these developments—or indeed, of economics as a discipline—this turn of events has rather suddenly given scholars at the cutting edge of consumer science an influential voice in the regulatory process, and some of the best and brightest have stepped up to contribute. Behavioral Economics & Public Health (edited by Christina Roberto and Ichiro Kawachi) is the product of a 2014 Harvard University exploratory workshop on applying social science insights to public health. As might be expected in a volume that aims to bring together two such inherently multidisciplinary fields, the book’s 11 chapters offer an eclectic mix of perspectives. The editors begin with an excellent overview of the field of behavioural economics and its applications to public health, and an economic perspective can also be found in four of the other chapters: Justin White and William Dow write about intertemporal choice, Kristina Lewis and Jason Block review the use of incentives to promote health, Michael Sanders and Michael Hallsworth describe their experience working within the UK’s Behavioural Insights Team, and Frederick Zimmerman concludes with a thoughtful critique of the field of behavioural economics. The other contributions are largely from the perspectives of psychology and marketing: Dennis Runger and Wendy Wood discuss habit formation, Rebecca Ferrer and colleagues emphasise the importance of emotion in decision making, Brent McFerran discusses social norms in the context of obesity, Jason Riis and Rebecca Ratner explain why some public health communication strategies are more effective than others, and Zoe Chance and colleagues and Brian Wansink offer frameworks for designing environments (eg, in schools and workplaces) that are conducive to healthy choices.

This collection of essays holds many hidden gems, but the one that surprised me the most was the attention given (by Runger and Wood briefly, and Zimmerman extensively) to a dirty little secret that behavioural economists rarely mention: once it is acknowledged that sometimes-irrational consumers can be manipulated into making healthy choices, it does not require much of a leap to conclude that business interests can—and do—use the same methods to push back in the other direction. This conclusion leads Zimmerman to a discussion of power in the marketplace and in our collective political economy, and to a call to action on these larger structural issues in society that neoclassical theory has long neglected….(More; Book)