Behavioural science: could supermarket loyalty cards nudge us to make healthier choices?

Curated on Posted on by Stefaan Verhulst

Article by Magda Osman: “Ken Murphy, CEO of the British multinational supermarket chain Tesco, recently said at a conference that Tesco “could use Clubcard data to nudge customers towards healthier choices”.

So how would this work, and do we want it? Our recent study, published in the Scientific Journal of Research and Reviews, provides an answer.

Loyalty schemes have been around as far back as the 1980s, with the introduction of airlines’ frequent flyer programmes.

Advancements in loyalty schemes have been huge, with some even using gamified approaches, such as leaderboards, trophies and treasure hunts, to keep us engaged. The loyalty principle relies on a form of social exchange, namely reciprocity.

The ongoing reciprocal relationship means that we use a good or service regularly because we trust the service provider, we are satisfied with the service, and we deem the rewards we get as reasonable – be they discounts, vouchers or gifts.

In exchange, we accept that, in many cases, loyalty schemes collect data on us. Our purchasing history, often tied to our demographics, generates improvements in the delivery of the service.

If we accept this, then we continue to benefit from reward schemes, such as promotional offers or other discounts. The effectiveness depends not only on making attractive offers to us for things we are interested in purchasing, but also other discounted items that we hadn’t considered buying…(More)”

The Unaccountability Machine — why do big systems make bad decisions?

Curated on Posted on by Stefaan Verhulst

FT Review of book by Dan Davies: “The starting point of Davies’ entertaining, insightful book is that the uncontrolled proliferation of accountability sinks is one of the central drivers of what historian Adam Tooze calls the “polycrisis” of the 21st century. Their influence reaches far beyond frustrated customers endlessly on hold to “computer says no” service departments. In finance, banking crises regularly recur — yet few individual bankers are found at fault. If politicians’ promises flop, they complain they have no power; the Deep State is somehow to blame.

The origin of the problem, Davies argues, is the managerial revolution that began after the second world war, abetted by the advent of cheap computing power and the diffusion of algorithmic decision-making into every sphere of life. These systems have ended up “acting like a car’s crumple-zone to shield any individual manager from a disastrous decision”, he writes. While attractive from the individual’s perspective, they scramble the feedback on which society as a whole depends.

Yet the story, Davies continues, is not so simple. Seen from another perspective, accountability sinks are entirely reasonable responses to the ever-increasing complexity of modern economies. Standardisation and explicit policies and procedures offer the only feasible route to meritocratic recruitment, consistent service and efficient work. Relying on the personal discretion of middle managers would simply result in a different kind of mess…(More)”.

Second-Order Agency

Curated on Posted on by Stefaan Verhulst

Paper by Cass Sunstein: “Many people prize agency; they want to make their own choices. Many people also prize second-order agency, by which they decide whether and when to exercise first-order agency. First-order agency can be an extraordinary benefit or an immense burden. When it is an extraordinary benefit, people might reject any kind of interference, or might welcome a nudge, or might seek some kind of boost, designed to increase their capacities. When first-order agency is an immense burden, people might also welcome a nudge or might make some kind of delegation (say, to an employer, a doctor, an algorithm, or a regulator). These points suggests that the line between active choosing and paternalism can be illusory. When private or public institutions override people’s desire not to exercise first-order agency, and thus reject people’s exercise of second-order agency, they are behaving paternalistically, through a form of choice-requiring paternalism. Choice-requiring paternalism may compromise second-order agency. It might not be very nice to do that…(More)”.

It’s time we put agency into Behavioural Public Policy

Curated on Posted on by Stefaan Verhulst

Article by Sanchayan Banerjee et al: “Promoting agency – people’s ability to form intentions and to act on them freely – must become a primary objective for Behavioural Public Policy (BPP). Contemporary BPPs do not directly pursue this objective, which is problematic for many reasons. From an ethical perspective, goals like personal autonomy and individual freedom cannot be realised without nurturing citizens’ agency. From an efficacy standpoint, BPPs that override agency – for example, by activating automatic psychological processes – leave citizens ‘in the dark’, incapable of internalising and owning the process of behaviour change. This may contribute to non-persistent treatment effects, compensatory negative spillovers or psychological reactance and backfiring effects. In this paper, we argue agency-enhancing BPPs can alleviate these ethical and efficacy limitations to longer-lasting and meaningful behaviour change. We set out philosophical arguments to help us understand and conceptualise agency. Then, we review three alternative agency-enhancing behavioural frameworks: (1) boosts to enhance people’s competences to make better decisions; (2) debiasing to encourage people to reduce the tendency for automatic, impulsive responses; and (3) nudge+ to enable citizens to think alongside nudges and evaluate them transparently. Using a multi-dimensional framework, we highlight differences in their workings, which offer comparative insights and complementarities in their use. We discuss limitations of agency-enhancing BPPs and map out future research directions…(More)”.

Fixing frictions: ‘sludge audits’ around the world

Curated on Posted on by Stefaan Verhulst

OECD Report: “Governments worldwide are increasingly adopting behavioural science methodologies to address “sludge” – the unjustified frictions impeding people’ access to government services and exacerbating psychological burdens. Sludge audits, grounded in behavioural science, provide a structured approach for identifying, quantifying, and preventing sludge in public services and government processes. This document delineates Good Practice Principles, derived from ten case studies conducted during the International Sludge Academy, aimed at promoting the integration of sludge audit methodologies into public governance and service design. By enhancing government efficiency and bolstering public trust in government, these principles contribute to the broader agenda on administrative simplification, digital services, and public sector innovation…(More)”.

Water Shortages in Latin America: How Can Behavioral Science Help?

Curated on Posted on by Stefaan Verhulst

Article by Juan Roa Duarte: “Today in 2024, one of Latin America’s largest cities, Bogota, is facing significant challenges due to prolonged droughts exacerbated by El Niño. As reservoir levels plummet, local governments have implemented water rationing measures to manage the crisis. However, these rationing measures have remained unsuccessful after one month of implementation—in fact, water usage increased during the first week.1 But why? What solution can finally help solve this crisis?

In this article, we will explore how behavioral science can help Latin American cities mitigate their water shortages—and how, surprisingly, a method my hometown Bogota used back in the ‘90s can shed some light on this current issue. We’ll also explore some modern behavioral science strategies that can be used in parallel…(More)”

An Anatomy of Algorithm Aversion

Curated on Posted on by Stefaan Verhulst

Paper by Cass R. Sunstein and Jared Gaffe: “People are said to show “algorithm aversion” when (1) they prefer human forecasters or decision-makers to algorithms even though (2) algorithms generally outperform people (in forecasting accuracy and/or optimal decision-making in furtherance of a specified goal). Algorithm aversion also has “softer” forms, as when people prefer human forecasters or decision-makers to algorithms in the abstract, without having clear evidence about comparative performance. Algorithm aversion is a product of diverse mechanisms, including (1) a desire for agency; (2) a negative moral or emotional reaction to judgment by algorithms; (3) a belief that certain human experts have unique knowledge, unlikely to be held or used by algorithms; (4) ignorance about why algorithms perform well; and (5) asymmetrical forgiveness, or a larger negative reaction to algorithmic error than to human error. An understanding of the various mechanisms provides some clues about how to overcome algorithm aversion, and also of its boundary conditions…(More)”.

The Behavioral Scientists Working Toward a More Peaceful World

Curated on Posted on by Stefaan Verhulst

Interview by Heather Graci: “…Nation-level data doesn’t help us understand community-level conflict. Without understanding community-level conflict, it becomes much harder to design policies to prevent it.

Cikara: “So much of the data that we have is at the level of the nation, when our effects are all happening at very local levels. You see these reports that say, “In Germany, 14 percent of the population is immigrants.” It doesn’t matter at the national level, because they’re not distributed evenly across the geography. That means that some communities are going to be at greater risk for conflict than others. But that sort of local variation and sensitivity to it, at least heretofore, has really been missing from the conversation on the research side. Even when you’re in the same place, in the same country within the same state, the same canton, there can still be a ton of variation from neighborhood to neighborhood. 

“The other thing that we know matters a lot is not just the diversity of these neighborhoods but the segregation of them. It turns out that these kinds of prejudices and violence are less likely to break out in those places where it’s both diverse and people are interdigitated with how they live. So it’s not just the numbers, it’s also the spatial organization. 

“For example, in Singapore, because so much of the real estate is state-owned, they make it so that people who are coming from different countries can’t cluster together because they assign them to live separate from one another in order to prevent these sorts of enclaves. All these structural and meta-level organizational features have really, really important inputs for intergroup dynamics and psychology.”..(More)”.

Mapping Behavioral Public Policy

Curated on Posted on by Stefaan Verhulst

Book by Paolo Belardinelli: “This book provides a new perspective on behavioral public policy. The field of behavioral public policy has been dominated by the concept of ‘nudging’ over the last decade. As this book demonstrates, however, ‘nudging’ is one of many behavioral techniques that practitioners and policymakers can utilize in order to achieve their goals. The book discusses the advantages and disadvantages of these alternative techniques, and demonstrates empirically how the impact of ‘nudging’ and ‘non-nudging’ interventions are often dependent on varying political contexts and the degree of trust that citizens have toward policymakers. In doing so, it addresses the important question of how citizens understand and approve of the use of behavioral techniques by governments. The book will appeal to all those interested in public management, public policy, behavioral psychology, and ‘nudging’. ..(More)”.

Behavioral Decision Analysis

Curated on Posted on by Stefaan Verhulst

Book edited by Florian M. Federspiel, Gilberto Montibeller, and Matthias Seifert: “This book lays out a foundation and taxonomy for Behavioral Decision Analysis, featuring representative work across various domains. Traditional research in the domain of Decision Analysis has focused on the design and application of logically consistent tools to support decision makers during the process of structuring problem complexity, modeling uncertainty, generating predictions, eliciting preferences, and, ultimately, making better decisions. Two commonly held assumptions are that the decision maker’s cognitive belief system is fully accessible and that this system can be understood and formalized by trained analysts. However, in past years, an active line of research has emerged studying instances in which such assumptions may not hold. This book unites this community under the common theme of Behavioral Decision Analysis. The taxonomy used in this book categorizes research based on task focus (prediction or decision) and behavioral level (individual or group). Two theoretical lenses that lie at the interface between (1) normative and descriptive research, and (2) normative and prescriptive research are introduced. The book then proceeds to highlight representative works across the two lenses focused on individual and group-level decision making. Featuring various methodologies and applications, the book serves as a reference for researchers, students, and professionals across different disciplines with a common interest in Behavioral Decision Analysis…(More)”.