Monday, May 11, 2009

Nudge (review by John Steeves)

Puzzling though it may seem, I would like to suggest a book I have never read. My only reason for proposing it is an interview I heard with one of the co-authors on the BBC.

The book is Nudge, written by Richard Thaler and Cass Sunstein, a couple of professors from the University of Chicago. Here's a link to a review:

As I remember the interview, the authors suggest that the best way of changing human behavior (whether economic or social) is to 'nudge' them, rather than to impose draconian orders to force such changes.

The co-author, Thaler, gave a couple of examples:

1. Officials at the Amsterdam airport felt they had a problem of cleaning expenses in men's washrooms. I think the word used was 'spillage'... basically caused by men not paying enough attention to their aims at the urinals. The solution the airport came up with was a 'nudge'... they etched a common housefly into the porcelain of the urinals. According to Thaler, the airport is now saving thousands of Euros in cleaning costs by the simplicity of giving men something to aim at rather than ordering them to aim. (He also said similar flys now appear in urinals in New York and Singapore).

2. Undoubtedly on a more serious note... Thaler said that the clean-up of polluting industries might be better served by the simple 'nudge' of demanding full disclosure of how much carbon and other pollutants they create.  Such disclosure, he argues, leads to the companies themselves trying to find ways to bring the numbers down. Presumably, out of embarrassment. (Or, at second best, seeing the neighbours suddenly becoming more insistent that they shape up).  If I recall correctly, he said there are actually studies that support this theory. Although I don't think he said it in the interview, I implied that he was ready to accept draconian punishments for anyone who evaded such full and open disclosure.

When I think of the Chicago school of economists, I think of Milton Friedman and right-wing politicians with their tax-cut manias and promises that benefits will then trickle down to the masses. During the interview, I found myself unable to peg this man as either right or left wing. I  got the impression he might be neither...  just a  bright guy with new ideas about what might, or might not, work for the benefit of society as a whole.

1 comment:

  1. John mentioned this book to me a few days ago after he read my post about "Predictably Irrational." I've since gone and ordered the book, so it should be here soon.