From Regulation to Behaviour Change: Giving Nudge the Third Degree
| Date | 01 November 2014 |
| Author | Robert Baldwin |
| DOI | http://doi.org/10.1111/1468-2230.12094 |
| Published date | 01 November 2014 |
THE
MODERN LAW REVIEW
Volume 77 November 2014 No 6
From Regulation to Behaviour Change: Giving Nudge
the Third Degree
Robert Baldwin*
Behaviour change strategies such as ‘nudge’ have become hugely popular with administrations on
both sides of the Atlantic. The practice of nudging, however, raises conceptual and controversial
issues which must be addressed in examining the conditions under which nudging can be used
effectively and acceptably. A key to a clear conceptual understanding of nudge-related issues is to
distinguish between three degrees of nudge. These three degrees raise different, and identifiable,
concerns and it is possible to assess the extent to which these can be responded to in positive
terms. The compatibility of nudging with other control devices cannot be assumed and, when
contemplating nudging, it is essential to be transparent about its philosophical basis, as well as to
be aware that different modes of intervention may operate with clashes of logic that threaten not
only effectiveness but also the serving of representative and ethical ends.
‘Nudging’ involves structuring the choices that people make in order to lead
them towards particular outcomes. Placing fruit next to the supermarket till, for
example, gives a nudge towards healthy eating. Such ‘behaviour change’ strat-
egies have become hugely popular with administrations on both sides of the
Atlantic. In the UK, David Cameron set up a Behavioural Insights Team (BIT
or Nudge Unit) at the centre of UK government in 20101to foster alternatives
to traditional regulation and to move towards less-restrictive and lower-cost
controls of behaviour. The governmental endorsement of nudging has not,
however, been based on clear positions regarding the nature of ‘nudge’ or the
role of nudge in the array of state control devices.
This article seeks to address these deficiencies and presents three central
arguments. First, that before nudging is further embraced, it is necessary to think
*Professor of Law, London School of Economics and Political Science. The author is grateful for the
comments of Vanessa Finch, Veerle Heyvaert, Andrew Lang, Martin Lodge, Henry Rothstein and the
anonymous referees.
1 The Behavioural Insights Team (BIT, or Nudge Unit) was set up in July 2010 with a remit to find
innovative ways of encouraging, enabling and supporting people to make better choices for
themselves. Professor Richard Thaler was appointed as an external expert to the BIT – See more
at http://blogs.cabinetoffice.gov.uk/behavioural-insights-team/author/behavioural-insights-team/
#sthash.mxq3kUis.dpuf. In early 2014 the nudge unit was part-privatised by sale to a charity and
to employees, see http://www.bbc.co.uk/news/uk-politics-26030205 (both last accessed 8 July
2014).
bs_bs_banner
© 2014 The Author. The Modern Law Review © 2014 The Modern Law Review Limited. (2014) 77(6) MLR 831–857
Published by John Wiley & Sons Ltd, 9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main Street, Malden, MA 02148, USA
much more clearly about the concept of nudge and to distinguish between the
different degrees of nudge that can be applied to targets. Second, that different
degrees of nudge can present distinct issues of effectiveness and can give rise to
separate concerns of a representative and ethical nature. Third, that a number of
important issues are easily overlooked if nudge is seen as just another mode of
influence in the toolbox of state controls.
The article begins by outlining the rise of ‘nudge’ before reviewing the
concept of nudge and distinguishing between three different degrees of nudge.
It then explores the limits to the effectiveness of the nudge strategy and the
representational and ethical problems posed by the different degrees of nudge.
The conditions for effective and acceptable use of nudge are then investigated
before the role of nudge in relation to other intervention methods is explored.
Emphasis will be placed on the dangers involved in seeing nudge simply as an
extra option in the toolbox of control devices. Finally, conclusions will be
offered on the feasibility of constructing a conceptual and ethical basis for making
choices regarding this fashionable intervention tool.
THE RISE OF NUDGE
The idea of ‘nudge’ is commonly associated with the book of that title published
by Richard Thaler and Cass Sunstein in 2008.2The two authors define a
‘nudge’ as
. . . any aspect of the choice architecture that alters people’s behaviour in a predict-
able way without forbidding any options or significantly changing their economic
incentives. To count as a nudge, the intervention must be easy and cheap to avoid.3
In this conception the ‘choice architecture’ is the environment that frames an
individual’s choice. Thus: ‘Putting the fruit at eye level counts as a nudge.
Banning junk food does not.’4
The proponents of nudge build on the well-established insights of cognitive
psychology and behavioural economics to contend that control systems need to
take on board the bounded rationality of citizens when they make daily deci-
sions.5Individuals are seen as constrained by limitations of information, cognitive
capacity and self-control and as tending to rely on a series of heuristics and
shorthand methods of using information.6As a result, they often make poor
2 R. Thaler and C. Sunstein, Nudge (New Haven, Ct: Yale University Press, 2008, revised as
Penguin, 2009). See also R. Thaler and C. Sunstein, ‘Libertarian Paternalism’ (2003) 93 American
Economic Review 175 and ‘Libertarian Paternalism is Not an Oxymoron’ (2003) 70 University of
Chicago Law Review 1159.
3 Thaler and Sunstein 2008, ibid, 6 (page references in this article are to the revised Penguin edition
of 2009).
4ibid,8.
5 On such insights see eg, A. Tversky and D. Kahneman, ‘Judgement Under Uncertainty: Heuristics
and Biases’ (1974) 185 Science 1124 and H. Simon, Administrative Behaviour (New York: The Free
Press, 4th ed, 1997).
6 Thaler and Sunstein 2008, n 2 above, ch 1 note many factors that lead to mistakes in human
judgement, such as: optimism and over-confidence; loss aversion; status quo bias; framing; inertia;
inattention and error; anchoring; availability and representativeness.
Giving Nudge the Third Degree
© 2014 The Author. The Modern Law Review © 2014 The Modern Law Review Limited.
832 (2014) 77(6) MLR 831–857
To continue reading
Request your trial