“Authored by two Univeristy of Chicago heavy-hitters, Economist Richard Thaler and Law Professor Cass Sunstein, Nudge explores the policy implications of behavioral economics, a field describing the irrationalities of human behavior. Taking findings from psychology (e.g. people procrastinate; theyâ€™re averse to losing money), Thaler and Sunstein propose policies to help us make the best decisions, in light of our irrational tendencies. In a classic example, they suggest we design 401k plans to require â€œopting-outâ€ rather than â€œopting-in,â€ thus encouraging people to save by default. […]
Nudge goes beyond psychological research to suggest concrete ways to improve public policy in light of experimental findings.
Humans are bad at long-term planning: but what if cars came with stickers tallying the monthly cost of gas over the next five years: sticker shock might lead buyers to a more efficient car? Or what if we â€œnudgedâ€ people to conserve energy by showing how their energy use stacks up with that of neighbors?”
WorldChanging book review: