Many of the problems governments and NGOs in developing countries are trying to fix are at least partly behavioural.
This is where nudge theory comes in. It is about using insights from behavioural science to identify reasons why people make bad choices, such as smoking or failing to pay taxes on time, and then testing small changes in the way choices are presented to “nudge” them into making better decisions.
The Global Insights Initiative (Gini), the World Bank’s new global nudge unit, was launched in October 2015 under the premise that “development policy is due for a redesign based on a more realistic understanding of how people think and behave”:
The World Development Report 2015 shows that people tend to think quickly, use mental models and shared mindsets, and care about their societies. The Report demonstrates that a more realistic understanding of choice and behavior can make development interventions much more effective.
The Global Insights Initiative (GINI), a new team in DEC, aims to do just that. It will work with World Bank teams from across the Global Practices, Cross Cutting Solution Areas, and Regions to incorporate behavioral and social insights into project design, evaluate the impact of interventions inspired by those insights, and mainstream behavioral economics, social psychology, and related fields into the work of the World Bank Group.
No longer is development policy just about taxes, subsidies and laws, says Varun Gauri, head of Gini. That the World Bank has set up its own nudge unit really signifies to NGOs, developing countries and their governments that the time to start using a behavioural approach has arrived, he says.