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Wednesday 9 February 2022

Nuts and Bolts: nudge theory.

 What works best, the carrot or the stick?

Nudge theory works on the carrot-stick (or else the stick made of carrot) principle: that is, it offers a very small reward or penalty (sometimes one of which the recipient isn't conscious) to nudge people in the desired direction.

For example, a chain of stores in the USA, Pay and Save, put green arrows leading to the vegetable section on the floor. People followed the arrows (for fun? Or did it just save them having to make a decision?) and sales of vegetables increased.

In the UK, people in arrears with tax payments have been sent messages telling them that nine out of ten people in their area are up to date with their tax. Does this make the debtors feel particularly inadequate? Or can't they stand being poorer than their neighbours? In any case, they pay up.

There's nothing new about nudges. Here's an Austrian referendum form from 1938 about whether Adolf Hitler should become head of state:


The theory of nudges, however, is quite recent. It was popularised in the 2008 book Nudge: Improving Decisions About Health, Wealth and Happiness by Richard Thaler and Cass Sunstein of the University of Chicago, but the idea was first described before 1995 by James Wilk.

Nudge: cynical manipulation or careful benevolence? It's easy enough to work out which each example is.

But only, of course, if you've spotted the nudge, first.

Word To Consider Today: nudge. This word appeared in English in the 1600s from Scandinavia. The Icelandic word nugga means to push.



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