MODULE -3 BEHAVIORAL ECONOMICS & NUDGE

BEHAVIORAL ECONOMICS
❑Behavioral Economics (BE) is a scientific discipline that combines microeconomics and psychology to
gain a deep and realistic understanding of consumer behavior.
❑The discipline was born with researchers such as Daniel Kahneman and Richard Thaler and studies the
cognitive processes behind decision-making rigorously and methodologically so that it can be applied to
improve the process.
❑Contrary to what is believed in traditional economics, BE argues that people are irrational in most of
their decisions and are strongly influenced by their environment.
❑Researchers say that we rely on two systems to make decisions. System 1 is faster and less rational,
while system 2 is more rational but also slower.
❑Most of the time, we are using system 1. A person makes on average 35,000 decisions a day, so the
brain seeks energy efficiency to solve them effectively and quickly.
❑That is why our brain takes mental shortcuts, known by heuristics that usually make this process effective
but can also lead to errors in judgment with biases.
❑There are more than 200 known biases and heuristics that can affect decision-making.
❑Nudge: Improving Decisions About Health, Wealth, and Happiness By Richard Thaler
❑Thinking fast and Slow by Daniel Kahneman
BEHAVIORAL ECONOMICS
➢Behavioral economics is a field that combines insights from psychology and economics to understand how people
make decisions.
➢Traditional economic theories assume that people are rational and always make choices that maximize their
benefits. However, in reality, people often act irrationally due to emotions, biases, and cognitive limitations.
➢Behavioral economics helps explain why people sometimes make decisions that seem illogical or against their best
interest.
➢Some rational Decisions
✅ Shopping for a Phone
A customer compares prices, features, battery life, and customer reviews before purchasing a phone, ensuring they
get the best value for money.
✅ Investment Decisions
An investor diversifies their portfolio instead of putting all their money in one stock, reducing risk and maximizing
long-term returns.
✅ Studying for Exams
A student makes a study plan and follows it instead of studying at the last minute because they understand the long-
term benefits of consistent studying.
✅ Healthy Eating
A person chooses a balanced diet and exercises regularly, understanding that long-term health benefits outweigh the
short-term pleasure of junk food.
Irrational Behavior
❌ Impulse Buying
A shopper buys an expensive watch just because it's on sale, even though they don't need it. (This is
influenced by the anchoring effect—seeing the "original" high price makes the discounted price look
like a good deal.)
❌ Procrastination (Present Bias)
A student postpones studying for an important test, choosing to watch Netflix instead. Even though
they know it will hurt their grades, the immediate pleasure of entertainment outweighs the long-term
benefit of studying.
❌ Lottery Tickets (Overestimating Low Probabilities)
People buy lottery tickets believing they have a real chance of winning, even though the odds are
incredibly low. They focus on stories of winners rather than the statistical reality.
❌ Overpaying for Brand Names (Halo Effect)
A person buys a designer T-shirt for $500, believing it's higher quality than a $50 shirt, even though
both are made from the same material. The brand name influences their perception of quality.
❌ Fear of Losing Money (Loss Aversion)
An investor refuses to sell a stock at a loss, even when it’s clear the price will keep dropping. They hold
onto it, hoping the price will recover, instead of cutting their losses.
HOW PEOPLE MAKE DECISIONS
➢Human decision-making is influenced by two main types of thinking: rational thinking and reflexive
thinking. These modes of thinking help us solve problems, make decisions, and react to different
situations in daily life.
1. Rational Thinking (System 2 Thinking)
Rational thinking is a slow, logical, and analytical way of processing information. It requires effort,
reasoning, and careful evaluation of facts before making a decision.
Key Characteristics:
✅ Deliberate – Requires conscious thought and effort.
✅ Logical – Based on facts, data, and structured reasoning.
✅ Slow and Methodical – Takes time to analyze information carefully.
✅ Used for Complex Decisions – Applied in problem-solving, planning, and critical thinking.
Examples of Rational Thinking:
✔️ A student researching and comparing universities before applying.
✔️ A business executive analyzing market trends before launching a product.
✔️ A scientist conducting experiments and evaluating data to test a hypothesis.
✔️ A person budgeting their expenses carefully before making a big purchase.
➢Rational thinking helps in making well-thought-out decisions and solving complex problems.
Reflexive Thinking (System 1 Thinking)
Reflexive thinking is an automatic, instinctive, and emotional way of thinking. It is based on gut feelings,
past experiences, and mental shortcuts.
Key Characteristics:
✅ Fast and Automatic – Happens without much conscious effort.
✅ Emotional – Influenced by feelings, biases, and experiences.
✅ Useful for Quick Decisions – Helps in situations that require instant reactions.
✅ Can Be Biased – Sometimes leads to errors in judgment due to cognitive biases.
Examples of Reflexive Thinking:
✔️ A driver hitting the brakes suddenly when seeing an obstacle.
✔️ A person choosing a familiar brand without comparing alternatives.
✔️ Reacting with anger or frustration before thinking through a situation.
✔️ Making impulse purchases based on advertisements or discounts.
Reflexive thinking allows us to react quickly in emergencies and make routine choices efficiently.
CLASSROOM ACTIVITY
Scenarios for Reflexive Thinking
1. You see a trendy item on TikTok and immediately buy it without checking reviews.
2. You scroll through Instagram stories and tap on an ad to purchase something impulsively.
3. You automatically accept cookie permissions on a website without reading.
4. You choose a restaurant because it has a cool aesthetic for Instagram photos.
5. You subscribe to a streaming service because everyone is talking about a new show, even though
you may not have time to watch it.
Scenarios for Rational Thinking
1. You are buying a new smartphone and need to compare specs, reviews, and prices before choosing
2. You are deciding whether to upgrade to a premium version of an app or continue using the free
version.
3. You receive a limited-time discount on an online shopping site. Do you make the purchase or wait?
4. You are considering whether to invest in cryptocurrency after seeing influencers promote it.
5. You have a tight budget. Should you spend money on a concert ticket or save for future expenses?
Key Concepts in Behavioral Economics
1. Bounded Rationality (Limited Thinking Capacity)
 People have limited time, information, and brainpower to make decisions. Instead of choosing the absolute best option,
they go for a "good enough" choice.
 ✅ A student buying a laptop may not compare all models in the market. Instead, they choose one that looks good and has
decent reviews, even if a better deal exists elsewhere.
2. Loss Aversion (Fear of Losing is Stronger than Winning)
 People dislike losing more than they like winning. Losing $10 feels worse than the happiness of gaining $10.
 ✅ A gym offers a "money-back guarantee" to encourage people to sign up. People fear losing the money they paid, so they
continue attending workouts even if they don’t feel like it.
3. Present Bias (Preferring Immediate Rewards)
 People tend to favor immediate rewards over long-term benefits, even if the long-term option is better.
 ✅ Many students procrastinate on studying because playing video games now feels more rewarding than preparing for an exam
that is weeks away.
4. The Endowment Effect (Overvaluing What We Own)
 People tend to overvalue things just because they own them.
 ✅ If you own a coffee mug, you might refuse to sell it for $5, even though you wouldn’t pay $5 to buy the same mug if you
didn’t own it.
5. Social Proof (Following the Crowd)
 People make decisions based on what others are doing, assuming the majority must be right.
 ✅ A new restaurant gets long lines because people assume it must be good if many others are eating there.

6. Anchoring Bias (First Information Influences Decisions)

 People rely too much on the first piece of information they receive when making decisions.
 ✅ If a store first shows you a $1000 TV and then a $500 TV, the second one seems like a bargain—even if it’s not.

7. Nudging (Subtle Changes to Influence Behavior)

 Governments and businesses use "nudges" to influence people's decisions without forcing them.
 ✅ Supermarkets place healthy snacks at eye level and junk food on lower shelves to encourage better eating habits.

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 ASK YOURSELF
Do you exercise?
Do your invest in stocks/ cryptocurrency?
Do you buy lottery tickets?
Do shop on vouchers?
Do you know how to dispose of plastic bottles?
Do you know what to do with your paper cups/plates
after use?
Do you maintain your car limit between 80-90 every
time?
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By asking questions like these and identifying answers through experiments, the field of behavioral economics
considers people as human beings who are subject to emotion and impulsivity, and who are influenced by their
environments and circumstances.
NUDGING
➢Nudge comes from behavioral economics and was popularized by Richard Thaler and Cass Sunstein
in their book Nudge (2008).
➢A nudge is a subtle intervention that influences people’s behavior without restricting their choices.
➢In behavioural economics, a nudge is a small, attention-grabbing aspect of the environment that is used to change
people’s behaviour in a predictable way without restricting their freedom of choice.
➢In simple words, a nudge is a small feature in the environment that attracts our attention and influences the way we
behave.
➢Instead of forcing decisions, nudges guide individuals toward making better choices that align with their well-being
and society’s interests.
➢Examples
➢ Placing healthy foods at eye level in a supermarket to encourage healthier eating choices.
➢Health: Placing fruit instead of candy at checkout counters in grocery stores.
➢Finance: Setting automatic savings deductions in payroll systems.
➢Environment: Adding green footprints leading to recycling bins to encourage waste sorting.
➢Education: Sending text reminders to students about deadlines to improve academic performance.
➢Public Safety: Using road markings that make drivers feel like they are speeding, causing them to slow down naturally.
➢Donation boxes can be placed near the check-out counters of the shopping stores to promote donations.
CHARACTERISTICS OF A NUDGE
➢Encourages, Not Forces: A nudge subtly influences behavior without mandates, bans, or
heavy incentives (e.g., taxes, fines).
➢Employers automatically enroll employees in a retirement savings plan but allow them to
opt out if they choose.
➢Preserves Freedom of Choice: Individuals can still make their own decisions; a nudge
does not eliminate any options.
➢Fast-food restaurants display calorie counts on menus to help customers make healthier
choices.
➢Uses Psychological Insights: Nudges rely on cognitive biases, habits, and mental
shortcuts that shape decision-making.
➢A default setting in software automatically enables privacy protections, requiring users to
manually turn them off.
➢Designed for Positive Impact: A good nudge improves outcomes for individuals and
society, such as healthier habits, better savings, or environmental conservation.
➢Placing green footprints leading to recycling bins in public areas to encourage waste
sorting.
➢Often Simple & Cost-Effective: Nudges can be small, low-cost changes that lead to big
improvements in behavior.
➢Rearranging cafeteria food placement so that healthier options (like fruits and salads) are
at eye level, while unhealthy foods are less prominent.
BENEFITS OF NUDGING
➢Improves Decision-Making: Helps people make better choices in health, finance, and daily life (e.g.,
automatic enrollment in retirement savings plans).
➢Encourages Healthy Behaviors: Small nudges can increase physical activity, healthier eating, and
better medical adherence (e.g., placing calorie counts on menus).
➢Enhances Economic Efficiency: Nudges help people avoid financial mistakes by promoting better
savings and investment habits (e.g., reminders for bill payments).
➢Supports Sustainability: Nudging can encourage eco-friendly behaviors like reducing plastic use,
conserving water, or recycling (e.g., defaulting to e-receipts instead of paper receipts).
➢Increases Compliance Without Coercion: Governments and organizations can use nudges instead of
strict laws or penalties (e.g., opt-out organ donation policies increase donor rates).

Bell Bajao - Ring Ring

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Crowd Management Health Living
Hygiene in
Class
Canteen Waste Management
TYPES OF NUDGES
1. Subtle Suggestions/provision of information
➢This type of nudge influences decision-making by making small, indirect hints towards a preferred behavior.
 Example: In restaurants, placing healthier food options at the top of the menu encourages customers to choose them
more often without removing unhealthy options.
 E-commerce websites use phrases like "Best Seller" or "Customers Also Bought" to subtly guide purchasing
decisions.
2. The Default Option
➢People tend to stick with the pre-selected choice, making default settings a powerful nudge.
 Example: Many companies automatically enroll employees in retirement savings plans. Employees can opt-out, but
the default encourages long-term financial planning.
 Subscription services, like Netflix or Amazon Prime, offer auto-renewal as the default option, increasing customer
retention rates.
3. Social Norming and Misperceptions
➢People often look to others for cues on how to behave. Social norming corrects misperceptions and
encourages positive behaviors.
 Example: Utility companies send electricity bills showing a household’s energy consumption compared to their
neighbors. If a household consumes more than average, they are nudged to reduce usage.
 Hotels encourage guests to reuse towels by stating that "75% of guests in this hotel choose to reuse their towels,"
leveraging social norms to promote sustainable behavior.
4. Anchoring
➢Anchoring is a type of nudge where an initial piece of information (the anchor) influences subsequent decisions.
 Example: Retail Pricing: Stores often display a higher original price next to a discounted price (e.g., “Was $100, Now $70”).
The original price serves as an anchor, making the discount seem more attractive.
 In salary negotiations, the first number mentioned (even if arbitrary) sets an anchor that influences the final agreed-upon
salary.
5. Simplification
➢Making processes easier increases participation and compliance.
 Example: Tax authorities simplify tax filing by pre-filling forms with available information, reducing the effort required for
submission and increasing tax compliance rates.
 Online checkout processes with one-click purchasing (e.g., Amazon's "Buy Now" button) simplify transactions, reducing cart
abandonment rates.

6. A Direct Reminder
➢Timely reminders help people follow through on intentions.
 Example: Medical clinics send text message reminders for upcoming appointments, reducing no-show rates and improving healthcare
efficiency.
 E-commerce platforms send abandoned cart reminders to customers, prompting them to complete their purchases and boosting sales.
 In practice, a “nudge” has come to mean:
An intervention that gently steers individuals
towards a desired action.
A nudge is a function of (a condition I) any attempt at influencing people’s judgment,
choice or behavior in a predictable way (condition a) that is motivated because of
cognitive boundaries, biases, routines, and habits in individual and social decision-
making posing barriers for people to perform rationally in their own self-declared
interests, and which (condition b) works by making use of those boundaries, biases,
routines, and habits as integral parts of such attempts. (Hansen 2016).
Thus, a nudge may be combined with traditional regulatory approaches but works
independently of the rational consequences of
 (a) forbidding or adding any rationally relevant choice options;
 (b) changing incentives, whether regarded in terms of time, trouble, social sanctions, economics, etc.; or
 (c) the provision of factual information and rational argumentation.

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nudging

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 A nudge maintains Freedom of choice
Transparent & Effective
It is easy & simple
Needs to be evidence-based
Features of Nudge
Has to be tested
Creative and lively

▪ Ten Important Nudges:

1. Default Rules
2. Simplification
3. Use of Social Norm
4. Increase in ease & convenience
5. Disclosure

A Short Guide to
6. Warning but creative, graphic
Nudge 7. Pre-commitment strategies
8. Reminders
9. Eliciting Implementation intention
10. Informing people about nature & consequence
 LET’S REFLECT

During a buffet lunch,

What do you pick to eat?
Do you finish everything you take?
Imagine if the college had slides instead of the staircase?
Do know how to dispose plastic bottle?
If your were awarded with cash prize for maintaining car speed limit would you keep doing it?
Would you like to
take the stairs to
class instead of
the lift?
NUDGE: HOW Furthermore, additional examples of nudges and their benefits appear in various other areas of
life. For instance:
SMALL Nudges can prompt people to take better care of their health. For example, sending people a
CHANGES CAN reminder to schedule a dental check-up doubled the rate of people who signed up.

SIGNIFICANTL Nudges can prompt people to make better financial decisions. For example, sending students a
few personalized text messages helped many of them remember to refile their application for
Y INFLUENCE student aid.

PEOPLE’S Nudges can prompt people to pay better attention to their privacy. For example, giving social-
media users a reminder about who will be the audience for content that they intend to post helped
CHOICES those users make better decisions regarding what to post and where to post it.

Nudges can prompt people to make choices that benefit other members of society. For
example, using an opt-out system for organ donations, where people are automatically registered
as organ donors unless they choose otherwise, instead of an opt-in system, where people have to
actively register to become donors, significantly increased the number of people that are
registered as organ donors.

Nudges can get people to make choices that are better for the environment. For example,
providing feedback to households about their and their neighbors’ electricity usage led people to
reduce their energy consumption.

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theory/
 A wonderful example of this principle comes from, of all
places, the men’s rooms at Schiphol Airport in Amsterdam.
There the authorities have etched the image of a black
housefly into each urinal. It seems that men usually do not
pay much attention to where they aim, which can create a bit
of a mess, but if they see a target, attention and therefore
accuracy are much increased.
Ballot Bins in London According to the man who came up with the idea, it works
wonders… His staff conducted fly-in-urinal trials and found
that etchings reduce spillage by 80 percent.”
Cigarette liters are everywhere! In a shocking research
by Truth Initiative, it was found that cigarette litter forms
38% of collected waste. Also, 75% of smokers tend to put
out a cigarette butt after getting down from a car or simply
while walking on the ground.
Types of nudges

•Setting a default option. For example, making people organ donors by default can increase the rate of organ donations,
compared to requiring people to opt-in in order to become donors.
•Creating a psychological anchor. For example, a charity soliciting donations can create a psychological anchor by telling
donors that “most people donate $20”, in order to nudge people to donate more money than they would otherwise.
•Changing the ease of choosing hard options. For example, to encourage people to eat healthier, a cafeteria can place
healthy foods in convenient locations and unhealthy food in less convenient locations.
•Changing the salience of certain options. For example, to encourage people to save more money, a workplace can design
relevant forms in a way that visually attracts people’s attention to the available saving program.
•Informing people. For example, giving people a simple flyer with information about their employer’s retirement savings
plan can lead people to contribute more to it.
•Reminding people of information they know. For example, reminding doctors about the problem of antibiotic resistance in
society can reduce the number of unnecessary antibiotics that they prescribe to patients.
•Reminding people to do something. For example, sending people a reminder that they need to schedule a doctor’s
appointment can increase the likelihood that people will do so when necessary.
•Getting people to slow down. For example, on social media, encouraging people to wait a short while between the moment
they submit a post and the time when it’s actually posted can lead people to edit and cancel posts that they would have
otherwise regretted making public.
Many of these types of nudges can be used both to influence other people’s behavior, as well as your own. For example, to reduce the amount of soda that you
and your family drink, you can make the soda bottles a more difficult option to choose, by placing them at the back of the fridge where they’re inconvenient to
reach. Similarly, you can also put a sticker on top of them, with a reminder for you all that you’re trying to drink less soda.
Note: nudges can be classified based on other criteria, such as whether they are transparent or non-transparent, or whether they involve defaults and anchors,
physical design, or deliberation tools.
Green Nudge
➢ Use & Application of Nudge Theory to ensure/enable Pro-Environmental behaviour;
➢ Use of Nudging/ the Nudge theory in Solving Social and Environmental Issues
➢ A Green Nudge is a subtle change in the way choices are presented that encourages people to
adopt environmentally friendly behaviors without restricting their freedom.
➢ These nudges leverage psychology and behavioral economics to make sustainable choices
easier, more attractive, and more socially accepted.
Example:
➢ In Germany and Switzerland, electricity providers set renewable energy as the default, significantly
increasing the number of users choosing green energy.
➢ Hotels with towel reuse programs saw greater participation when the default was “reuse” instead of
“replace.”
➢ Utility companies like Opower in the U.S. send energy bills comparing a household’s electricity use to
that of its neighbors, leading to a 2-5% reduction in energy consumption.
➢ Cities like Copenhagen prioritize bike lanes and bike-sharing systems, leading to higher bicycle use
and reduced car emissions.
➢ Water taps with LED indicators that change color based on water usage help reduce waste.
➢ Airlines like Akasa show the carbon footprint of flights, encouraging customers to choose lower-
emission options.
How to design a Nudge?
Factors to consider while creating Nudge
1. Psychological & Social Context
➢ People’s decisions are influenced by cognitive biases, habits, and social norms.
Key Psychological Factors:
✓ Status quo bias: People tend to stick with the default option.
✓ Loss aversion: Fear of losing something is more motivating than the potential for gain.
✓ Social proof: We mimic behaviors that seem common or socially accepted.
✓ Immediate gratification: People value short-term benefits over long-term rewards.
Example:
Social Norms for Energy Saving
•A U.S. energy company, Opower, used peer comparisons in electricity bills: “Your neighbors used 20% less
energy than you.”
• Result: 2-5% decrease in energy consumption.
Plastic Bag Bans & Charges
•When supermarkets charge for plastic bags instead of giving discounts for reusable bags, people use fewer
plastic bags due to loss aversion.
2. Choice Architecture
➢ The way choices are presented affects decision-making.
➢ The goal is to make desirable choices easier, more visible, and more accessible.
➢ Defaults, framing, and convenience are key techniques.
Types of Choice Architecture:
✓ Default options – Making the desirable option the standard choice.
✓ Framing effect – Presenting information in a way that encourages desirable choices.
✓ Feedback & visibility – Real-time data on resource consumption.
✓ Convenience engineering – Making desirable actions easier to perform.
Example:
Default Green Energy
✓ In Germany & Switzerland, when renewable energy was the default electricity plan, adoption rose to 90%+
compared to opt-in systems.
Convenient Recycling Placement
✓ People recycle more when bins are closer than trash cans.
Framing Sustainable Travel Choices
✓ Presenting train travel as the “smart choice” and air travel as “high carbon” encourages people to take trains.
3. Behavioral Change Principles/Libertarian Paternalism
➢ Nudges work by gently shifting behavior rather than forcing compliance.
➢ Unlike bans or mandates, nudges offer freedom with structured guidance.
✓ Uses habit formation, reinforcement, and goal setting to create lasting change.
✓ Key Strategies for Behavior Change:
✓ Commitment & pledges – Public promises increase accountability.
✓ Gamification & rewards – Incentives and points encourage repeated behavior.
✓ Small gradual steps – Incremental nudges lead to habit formation.
Example:
✓ Public Pledges for Plastic Reduction
✓ Schools encouraging students to sign a pledge to reduce plastic use increases compliance.
✓ Gamification for Recycling
✓ In Sweden, reverse vending machines reward recyclers with small incentives, increasing participation.
Five steps to make your nudge a success
1. Choose your target behaviour 3. Design your nudge
• What is your nudge?
• What is the specific target behaviour you want e.g. change descriptions of food on menus
to change? • What resources will you need?
e.g. reducing non veg consumption on campus e.g. time and creativity to brainstorm new menu descriptions
• Who is your specific target audience? (no cost for printing menus compared to business as usual)
e.g. first-year students • Whose buy-in do you need in order to implement your
2. Understand your context nudge?
e.g. campus catering manager
• What individual influences on behaviour might be
barriers or drivers? 4. Test the effectiveness of your nudge
e.g. students lack cooking skills and experience planning • What behavioural outcome will you measure?
e.g. number of non veg dishes sold per day in cafeteria for the
grocery shopping
whole term
• What social influences on behaviour might be barriers • What is your comparison to know if your nudge worked?
or drivers? e.g. record sales of non veg dishes for a term before the
e.g. social norms of eating meat nudge, or record in another cafeteria without the nudge
• What material influences on behaviour might be barriers 5. Reflect and redesign
or drivers? • How could you improve your nudge?
e.g. contract with catering company e.g. next time redesign the menu to feature plant-based dishes
• What are the touchpoints where you could intervene to more prominently
change behaviour?
e.g. campus cafeterias
How to design a Nudge?
How to use nudges
• The nudge should fit the target audience.
• The effectiveness of specific nudges depends on the circumstances.
• Small nudges can sometimes be more effective than bigger ones.

few additional guidelines that you should keep in mind

when deciding whether and how to present your nudges to
others:

1. Nudges shouldn’t necessarily be hidden.

2. People should perceive the nudge as
beneficial.
3. People should feel that the nudge respects
their ability to choose.
4. People generally prefer nudges that target
their conscious reasoning.
 Green Nudge

Book Review The Nudge

 The BellBajao! (Ring the Bell!) campaign, launched in India in 2008 by New Media of Breakthrough, is the first multimedia campaign to directly address men in the
context of violence, previously a severe taboo in India, and to help men take ownership of interventions to effectively end domestic violence. BellBajao! calls upon
men & boys alike to take action and renounce the role of perpetrator or spectator of violence towards women. Supported by an on-the-ground youth mobilization, the
multimedia campaign has reached over 130 million people in India. BellBajao! takes a multi-dimensional approach, raising awareness about domestic violence in
public service announcement ads aired on national television and radio, organizing gender and human rights training workshops, sending multimedia equipped video
vans across the country and working online via prominent channels like Youtube and Vimeo. The BellBajao! blog is one of the few user-generated platforms that

MAKE A NUDGE encourage the exchange of opinions, studies, experiences or personal stories on issues from gender and violence to sexuality, where virtual discussions sometimes
spill over into grassroots action. BellBajao! has won all the major advertising accolades, while its ads have been featured by YouTube on International Women’s
Day. BellBajao! has shown that critical social media can take on petrified normative social values on a big scale, becoming a pioneering case study to be emulated.

Disposal of Plastic bottles

Use the Six D’s to Create a nudge Bullying
Indicate the type of Nudge used
Inclusivity & Diversity
Electricity Conservation
Use of cars for short distant
Reduce usage of social media
Food wastage by students

Bell Bajao - Ring Ring

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 Positive and gentle persuasion to encourage sustainable behavior
Nudging is based on an understanding of the psychology of decision-making

GREEN NUDGE Our brains have limited resources to make sense of a world that is complex and
uncertain, which means that we use mental shortcuts that make our behavior highly
context-dependent

What is Green NUDGES? we follow ingrained routines or act on auto-pilot.

Using Choice architectures behaviors can be directed toward a sustainable choice
Encourage certain choices or explicitly design choices to harness or overcome common
cognitive biases

Nudges help people live their values Nudges are needed now
WHY USE Green NUDGES?
Nudges can work better than raising Nudges are cost-effective
awareness
HOW TO NUDGE: GO EAST
Easy
People often take the path of least resistance

Attractive
Humans are more likely to adopt a behaviour
when it captures our attention
Social
Human behaviour is hugely influenced by what
others around us are doing.
Timely
People are creatures of habit, so nudges
are most effective at moments of change in
people’s lives.
 Use defaults
• Set the norm that diners will use their own cup and cutlery
• Make the most sustainable meal the default choice
• Default to eco settings on appliances and Electronics.
• Make remote dial-in and sustainable travel the default options
Remove or add frictions
• Make it easier to cycle around campus
MAKE IT EASY • Introduce applications for parking cars on Campus
• Make it harder to let taps and showers run
• In university cafeterias, offer smaller plates and no trays
Change the choice environment
• Make sustainable options more prominent
• Offer sustainable substitutes for common foods
• Make sustainable options more prevalent
 Draw attention
• Make recycling bins eye-catching
• Install smart meters with feedback Displays
• Indicate food “use by” dates clearly
• Personalize messages
Frame messages positively and highlight co-benefits
• Promote plant-based food as aspirational, delicious and filling
MAKE IT ATTRACTIVE • Harness positivity and pride
• Create social opportunities for sharing and reuse
Use smart incentives
• Charge for not using your own coffee mug
• Promote sustainable “meal deal” incentives
• Publicly display sustainability ratings
• Introduce lottery-based deposit return schemes
 Highlight others’ sustainable behaviour
• Share information about positive trends
• Provide social comparisons of energy and water use
• Publicize university rankings that measure Sustainability
Harness identity and the right messengers
MAKE IT SOCIAL • Broaden messages to appeal to a wide audience
• Choose messengers who will be received positively
• Highlight desirable Identities
Use social connections and peer pressure
• Create opportunities to make public pledges
• Provide incentives to encourage peer referral
• Distribute and share Leftovers
 Encourage pre-commitments and emphasize present
benefits
• Encourage pre-ordering of catered meals
• Ask people to pre-commit to gradual changes
• Offer interest-free loans for public transport passes
Harness or create timely moments
• Help newcomers form sustainable habits
MAKE IT TIMELY
• Reduce waste at the end of the term
• Hold campus-wide moments of action
Help people plan and follow through
• Provide checklists
• Support people before they need it
• Help people follow through on saving energy
Summary and conclusions
•A nudge is a simple aspect of people’s decision-making environment that alters their behavior in a
predictable way, without forbidding any options or significantly changing their incentives.
•Examples of nudges include sending people a reminder to schedule a doctor’s appointment, ensuring that
healthier food is more noticeable in a cafeteria, providing people with information regarding how much
electricity they use, and reminding people what audience will see what they’re about to post on social
media.
•Common types of nudges include setting a default option, creating a psychological anchor, changing the
ease of choosing certain options, changing the salience of certain options, informing people of something,
reminding people of information they already know, reminding people to do something, and getting people
to slow down.
•To use nudges, start by determining who the nudge will target and what outcome you want to achieve with
it, while considering whether a nudge is an appropriate solution; then, design and implement the nudge,
while remembering that the nudge should fit your target audience, that the effectiveness of specific nudges
depends on the circumstances, and that small nudges can sometimes be more effective than bigger ones.
•To respond to a nudge, you should realize that it’s in effect, assess it, and then either accept it, ask the
responsible individual about it, call out its use, eliminate it, use debiasing techniques to reduce its influence,
or take it into account without doing anything about it directly.