Nudge in Chief: Choice Architecture and Public Policy (Guest Post)

President Obama’s recent executive order encourages federal agencies to utilize behavioral science insights in the development of their policies and program.

Read what my friend, Diana, has to say about it and follow her posts on LinkedIn Pulse!


On September 15, 2015, President Obama signed an Executive Order titled,“Using Behavioral Science Insights to Better Serve the American People.”  Behavioral science – an amalgamation of behavioral economics, psychology, and cognitive science – aims to uncover the intricacies of the human decision making process, and its utility in improving the public sphere has finally been acknowledged at the highest level.

The research findings regarding human behavior have already been applied to a number of areas, most notably marketing and advertising. However, as Richard H. Thaler and Cass R. Sunstein assert in their book “Nudge: Improving Decisions about Health, Wealth, and Happiness,” behavioral science can and should be applied to a number of spheres not just to influence, but to improve  the choices that individuals make.

Choices aren’t made in a vacuum. You may think that you are in control of your choices, but a large portion of your response is determined by the environment around you – the choice architecture. Thaler and Sunstein argue that there is a technique to how choices can be presented in order to help people select options that will improve their lives. This technique called “nudging” involves subtly changing the structure of the environment without limiting choice. For example, Google redesigned their cafeteria to make healthy choice more visible, with the result of employees’ fat consumption from candy dropping an impressive 11 percent. In addition, according to Thaler and Sunstein, “for reasons of laziness, fear, and distraction, many people will take whatever option requires the least effort” – meaning the default option. For example, in countries where the organ donation form is set as “opt-out” (check this box if you don’t want to participate), people do not check the box and are automatically enrolled to donate their organs. If the organ donation form is set as “opt-in,” people do not check the box and are automatically not enrolled to donate. In both cases, large proportions of people simply adopt the default option.

This executive order signed by President Obama specifically addresses the concept of choice architecture and highlights the power of the default option, as it pertains to public policy. Executive departments and agencies are mandated to consider how the presentation of choices can promote public welfare, giving particular consideration to the selection of the default option. The goal is to create federal programs that reflect how people engage with and respond to choices. For example, the executive order cites automatic enrollment and automatic escalation in retirement savings plans, default options that have made it easier to save for the future and accumulate billions of dollars in additional retirement savings.

Working in management consulting has solidified my deep appreciation for and trust in evidence-based thinking. Solid data provides me with the foundation upon which I can build sound recommendations for clients. Unfortunately, in my eyes, the political sphere is one where voters make decisions based on emotions and politicians make decisions based on the desire to be re-elected to power. But shouldn’t our leaders adhere to data-driven practices? According to President Obama, the answer is yes. This executive order marks a tremendous step forward towards bringing evidence-based practices into the public sphere.

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