“BEHAVIOURAL PUBLIC POLICIES: APPLICATIONS TO THE FIGHT AGAINST POVERTY, TAXATION AND NUTRITIONAL HEALTH”
KEYWORDS: Public policy, behavioural studies, experiments, nudging, framing, poverty, taxation, nutritional health
Founded Research project — 2016-2019 — Ministerio de Economía y Competitividad (MINECO), R&D&I National Program, Ref.: CSO2015-64740-R.
IP: José A. NOGUERA
This project aims to explore the potentialities of behavioural studies for public policy design. We intend to apply the behavioural public policy approach to three specific areas that are directly linked with citizens’ wellbeing: the fight against poverty, taxation, and nutritional health. Recent studies in behavioural public policy provide growing evidence of how simple and low-cost interventions on agents’ incentives, as well as on the architechture and framing of the decisions they face, may have substantial and beneficial effects for the achievement of public policy objectives. These effects may also help to avoid some of the counterproductive effects of such policies and produce behaviour which leads to a higher level of wellbeing.
The behavioural public policy approach is based on recent developments in the experimental social sciences which show that individuals are not perfectly rational agents, and therefore are not always prepared to make decisions that maximize their own wellbeing. This is due to cognitive shortcomings and biases, as well as to social emotions which are embedded in the dynamics of social influence. It is therefore necessary to explore how to design policies and decision environments which enhance the attractiveness and salience of decisions and conducts that maximize compliance and wellbeing. The project will focus on analyzing two basic mechanisms in this respect: nudging (manipulating the architechture of decisions) and framing (manipulating the presentation or description of the decision options). Nudging is a mechanism of influence which alters the decision environment while keeping all available options as well as agents’ freedom to choose; the point is to make some options more attractive or easier in cognitive and social terms, and always for the benefit of the agents involved and/or the public interest. Framing consists in re-describing decision options in an extensionally equivalent way, but making some aspects more salient or visible than others.
In order to test the fertility of the behavioural approach, we intend to design a series of behavioural studies in three different areas in which the members of the research team have some expertise: the fight against poverty, taxation, and nutritional health. In the first case, we will explore the effectiveness of different nudging and framing mechanisms on two traditional problems of anti-poverty policies: non-take-up and the poverty trap. In the second case, we will analyze the effect of such mechanisms in the improvement of tax compliance and tax morale. Finally, we will study the impact of such mechanisms on the avoidance of different cognitive biases and mistakes which lead individuals to consume non-healthy food instead of making healthier nutritional decisions.
We estimate a high potential impact of the project’s results on three key areas for citizens’ wellbeing: improving the situation of the worst-off through designing and implementing better anti-poverty programmes; designing low-cost strategies in order to enhance tax compliance and tax morale; and designing interventions which encourage healthy nutritional behaviour.