By Rory Wilding
In my previous post I discussed how mental shortcuts may block us from making sensible and sustainable decisions. Now I'll look at what can be done to tackle these mental biases or how we can even use these cognitive biases to make smarter more sustainable choices.
There is a plethora of research and interventions dedicated to helping people make happier and healthier decisions stemming from Nudge Theory. The idea of the Nudge came to prominence in 2008 with the global popularity of the release of Professor Thaler's book, also called Nudge. Nudges are more formally known as "choice architecture." This architecture alters people’s behavior in a predictable way -- nudges can be successfully used to change behavior without banning any options or significantly changing their economic incentives. To count as a mere nudge, the intervention must be easy and cheap to avoid. The UK was one of the first governments in the world to construct a behavioral insights team (BIT) dedicated to nudging behavior in the right direction. For example, the BIT found that tax payments increased when the payment due notice included a mention of the fact that most citizens pay on time. Other nations have followed suit with both Australia and the United States now implementing ideas based around the theory.
The insights from behavioral economics are not a new fad. This research began in the 1960s, has been replicated time and time again. Principles from the lab have successfully been implemented in the real world to change behavior ranging from non-payment of debts to organ donation.
The ethics of nudges in relation to sustainability has been covered elsewhere so we are not going to dive into whether it's the right thing to do. The big question we have is given the scale of the climate change challenge, what is being done or suggested to nudge people’s behavior in the right direction?
We previously discussed how sunk costs and high capital expenditure anchors can reinforce the status quo and stop individuals from acting. We think that the low carbon loans are a great way to break down these psychological barriers. Energy efficiency loans are repaid through the efficiency savings a company makes. This means they can migrate to more sustainable practices for free, however unfortunately this funding is often only available to larger organizations rather than individuals. We think it would be great to see this kind of funding extended to individual consumers by forward thinking organizations, for instance home broadband providers.
Analysis Paralysis is a tough one to challenge. There seem to be an ever-growing barrage of green led initiatives out there; so which ones are worth our time and attention? Simple - the ones that work. Interventions with clear payback should become the new default mode of operation – home automation (through smart thermostats and water meters) plus LED lighting are really easy wins that everyone household could safely benefit from. Government and industry needs to communicate this effectively so people can easily discern hero interventions from the hype to help shape effective decisions.
Often to break Status Quo biases we need to look at what the default is. In 2015 there are 2.6 billion people around the world using email. That means we should be seriously considering whether sending a paper letter needs to happen. We have noted that many businesses have set paperless billing as the default which is better for business bottom lines, better for profit margins, and, when set as the default option, better for individuals who don't need to think to make a sustainability contribution.
Attribution substitution often leads us astray when we need to make judgements that are computationally complex; to offset this we need to think of solutions that make these decisions much simpler. Home automation is a great example here. We have traditionally done a poor job of keeping track of our energy expenditure simply because its difficult to calculate how much energy we are using over a given period. Home automation apps, such as the Nest smart thermostat, are really going a long way to combatting this by showing us exactly how much we are using or even going a step further to notify us how and where we can save money on our heating bills.
A key point here is there are no one size fits all approach to using choice architecture to tackling psychological barriers to sustainability. It may even be that these interventions have not been designed with behavioral economics in mind. It is however clear that these interventions influence the mental shortcuts that have been repeatedly verified in the lab, to influence our behavior and help us make more sustainable decisions.
It has been stated in the past that nudges may not be enough and we may need tougher government policy to enforce cleaner living. That may be true but we behavioral economics and nudges hold a lot of promise in the sustainability arena. Put simply we our behavior led us into this situation, changing our behavior can lead our way out if it to a greener, cleaner, future.
Rory is the commercial director of Which LED Light, the UKs leading independent LED light comparison service. Rory has a background in Psychology and is interested in the climate change challenge from a behaviour change perspective. Follow Rory on Twitter at @WhichLEDlight.