Nudge: The Final Edition

methods, you will lose $ 3So per year. It turns out that information campaign (b), framed in terms of losses, is far more effective than information campaign (a). If the government wants to encourage energy conservation, option (b) is a stronger nudge.Framing works because people tend to be somewhat mindless, passive decision makers. Their Reflecti

incredible work in applied behavioral economics that was happening in the government, specifically using the power of defaults to encourage positive behavior. These defaults are known as nudges, made famous in the bestseller Nudge, by Richard Thaler and Cass Sunstein.

The idea is that choices depend, in part, on the way in which problems are stated. The point matters a great deal for public policy. Energy conservation is now receiving a lot ofattention, so consider the following information campaigns: (a) If you use energy conservation methods, you will save $350 per year; (b) If you do not use energy conservati

Sometimes the invisible handwave is combined with the incentives argument to suggest that when the stakes are high and the choices are difficult, people will go out and hire experts to help them. The problem with this argument is that it can be hard to find a true expert who does not have a conflict of interest. It is illogical to think that someon