by: Tifara Ashari and Nadhila Renaldi
Along with the growing interest of the government to explore the unconventional intervention for policy-making, nudge has enlightened decision-makers to study and to exploit behavioural reaction of society to achieve policy-goals. On March 21st, 2021, the second monthly forum of ISF – Politics and Law took the opportunity to invite the audience to understand and critically analyse the nudge. The discussion was led by Nadhila Renaldi and Tifara Ashari, students of MPP and MPPA at LSE.
As the opening, a little experiment on the optical bias using “Shepard tabletop illusion” (1990) where the audience were asked to choose between two tables which actually are identical. Continuing the discussion, the presenter explained about the concept of homo economicus or econs which assumes humans act based on optimum utility. This concept is challenged by Simon who uttered the concept of Bounded Rationality and Kahneman who introduced System 1 (intuition/automated) and System 2 (reasoning) of thinking process which concludes that our thinking process does not always computate, sometimes it works “in auto-pilot” or intuitively, hence it is prone to cognitive biases. Bias and its motivation are then explained by the mnemonic “M.I.N.D.S.P.A.C.E”.
Utilising the bounded rationality of the humans, government designs preferences and at the same time, moves people in direction that will make their lives better, hence libertarian paternalism. This strategy is called nudge and was firstly popularised by UK government in 2010 with its Behavioural Insight Team (BIT). Government acting as choice architects substantially hold three principles: 1) not erasing less-desirable choice but making better choices more visible and under the spotlight; 2) cost efficient & in unrestricted way; and 3) exploiting system 1 for meaningful behaviour change. Therefore, based on the impact and its complexity, the forms of nudge can be categorized into: 1) framing & formatting; 2) choice design; 3) social cues; 4) message simplification; 5) personalised motivation; and 6) reminder and planning prompts.
Strategic approach on the nudge implementation can be derived into three phases, which are: 1) problem identification which mostly based on economic rationale; 2) identification of expected behaviour to solve the problems, and 3) intervention choices, which are followed up by ex-post effectiveness analysis that determines whether the nudge yields suboptimal result (can be replaced by other interventions) or is successful and scalable or replicable. The implementation of nudge itself has been varied, ranging from the infamous “the images of fly at the urinal post” to reduce urine spillover in public toilet to early-tax-return reminder.
The discussion then moved to whether nudge is ethical. Some participants believed that nudge is ethical because nudge is not a coercive measure and options remain available for the individuals. Other participant claimed that nudge is not ethical because the aim to obtain ‘better decision’ may not be shared by minority groups. Further, it was argued that transparency by policymakers is essential in implementing nudge within a society.
Nadhila and Tifara explained that nudge can paradoxically become a double-edged sword. The question on the sustainability of nudge requires a further examination on the longitudinal study of nudge. In addition, a notable call-out on the unintended consequences of nudge has also showed a possible utilisation of nudge as political vehicle by certain entities.