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Back in March I made a note to myself to write a paper – or, more likely, a blog post – presenting a taxonomy of behavioural interventions. I had gotten tired of everything being called a ‘nudge’ and with debates about whether nudges are ethical. I even bought a copy of Nudge so that I could use it to populate the taxonomy with examples.

Thankfully, someone else was already working on this and has beaten me to it – producing almost exactly what I had in mind. Mira Fischer from the University of Cologne and Sebastian Lotz from Stanford have written a working paper titled ‘Is soft paternalism ethically legitimate? – the relevance of psychological processes for the assessment of nudge-based policies‘. They differentiate between 4 types of behavioural intervention – or ‘nudge’ – and discuss the ethical implications associated with each by considering the psychological processes at play. It’s far better than any blog post I could have written, and I recommend reading it.

Fischer and Lotz’s taxonomy

Consider a utility-maximising individual with 2 choices (A or B), each with 2 possible outcomes (1 and 2), such that the utility associated with choice A would be , where ‘π’ is the probability and ‘u’ the utility of the outcome and the ‘M’ and ‘N’ refers to monetary and non-monetary utility. Based on this, the authors then discuss the ways in which various types of nudge might influence the individual’s choice. The table below is not from the paper and is my interpretation of the taxonomy.

Type Name Point of influence Means of impact on expected utility of choice Examples 1 ‘discomfort nudge’ choice evaluation non-monetary utility default settings on electronic devices; communication of social norms 2 ‘probability nudge’ choice evaluation subjective probability of realisation informational campaigns 3 ‘indifference nudge’ preference formation monetary or non-monetary utility positioning of healthy/unhealthy products 4 ‘automatism nudges’ ? ? changes in road markings

Is the taxonomy complete and well-defined?

In my opinion, it is not.

I do not believe that Type 4 nudges exist in the way described. The authors use the example of changing road markings to make drivers think they are travelling faster than they actually are and thus reduce their speed. It seems clear to me that this is an example of Type 2; the driver has been made to believe that the probability of them crashing at their current speed is greater than they would otherwise have believed. The idea that there is an ethical difference between nudges to our ‘automatic’ behaviour and nudges to our considered behaviour – given that so much of our behaviour is automatic – I believe is unfounded.

When I was considering writing my own taxonomy of behavioural interventions, I was approaching it from a decision analysis perspective. Simply imagining the structure of an individual’s decision process and considering the different points at which an individual could be influenced. Based on the Thaler/Sunstein definition, a nudge can affect any part of a person’s decision process.

Based on this I believe there are 3 points of influence: i) before an individual’s preferences are defined ii) after the definition of preferences but before the observation of the choice set and iii) once the choice set has been recognised. Once preferences are defined and the choice set has been recognised there are 2 means of influencing choice; utility or probability.

As such, I think the taxonomy should look like this:

Type Point of influence Means of impact on expected utility of choice Examples A preference formation values/priorities education; positioning of food B choice set observation choice set expansion/compression positioning of food; introduction of cycle lanes C choice evaluation subjective probability informational campaigns D choice evaluation utility defaults; communication of social norms

As the authors outline in their paper, particular nudges will cross type boundaries. I have included the ‘positioning of food’ nudge under 2 types to highlight this. If positioning causes an individual to choose a healthy item – where they otherwise would have chosen a less healthy one – this could either be because they saw the healthy item first or because they simply didn’t see and fully consider the unhealthy option. In the former case Type A is at work, while in the latter case Type B is at work. I believe that educational interventions could fall into any of the above types because they can improve an individual’s ability to satisfy their own preferences. Type D could, of course, include a tax or a subsidy.

Furthermore, the ethical implications may be different depending on whether the impact on types B, C or D is positive or negative, and also whether the impact on utility is monetary or non-monetary, which would increase the total number of types to 9.

I don’t know whether I, the authors or both of us are right, but there’s one thing we can agree on. One nudge isn’t necessarily as ethical as the next, so we need better ways of defining behavioural interventions.

DOI: 10.6084/m9.figshare.1232109

By Chris Sampson Founder of the Academic Health Economists' Blog. Principal Economist at the Office of Health Economics. ORCID: 0000-0001-9470-2369

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