Recently, there has been a shift in paradigms in the debate about policies and their focus on nudge. Strategies for nudging are based on the understanding of social, moral and cognitive factors that drive human decision making. The area of environmental policy nudging is influenced by the government to help change citizens and corporate behaviour. Even though nudging strategies are often based on social science literature, the translation of theory into working strategies is not as straightforward as it might seem. Within nudge heuristics, the complexities and challenges of decision making should be addressed, otherwise potential in the creation of viable policy intervention is lost

Recently, there has been a shift in paradigms in the debate about policies and their focus on nudge. Strategies for nudging are based on the understanding of social, moral and cognitive factors that drive human decision making. The area of environmental policy nudging is influenced by the government to help change citizens and corporate behaviour. Even though nudging strategies are often based on social science literature, the translation of theory into working strategies is not as straightforward as it might seem. Within nudge heuristics, the complexities and challenges of decision making should be addressed, otherwise potential in the creation of viable policy intervention is lost.

What are the objectives for this study?

Policy makers are developing new insights to re-emphasize or approach the way we approach citizens. These understandings have been neglected because in a state led society, command and incentive-based interventions were good enough. However, while seeking an alternative to create behaviour change, different tools -and way of thinking was required. This is when the nudge theories gained in popularity. Nudge thinking challenges some of the presumptions of the current national policy and administration. Yet there is evidence from social science that implications of nudging are not as straightforward as some of the advocates for nudging theory suggest. The translation of nudge insights to policy involve social and political challenges. The objective of this study is to argue that nudges that are already designed into policies might be limited in value because instead of a top-down way of processing, a bottom-up way should be used in the translation from nudge insights into practice.

When did the nudge paradigm emerge?

Jackson (2005) commented on existing policies that used traditional theories on how to change behaviour. He argued that the notion that people make rational decisions based on self-interest is so embedded in our policies on how to change consumer and citizen behaviour, it has an immediate familiarity to us. In the book Nudge, by Thaler and Sunstein (2008) the rationalist view of changing human behaviour is challenged. He argues to see people as homo economics instead of homo sapiens. People are less than perfect decision makers, they do not make rational decisions, but rather use shortcuts, social norms, pressures and even morals. The starting point for nudge was that people lack the ability to process all the information of multiple sources to some to a decision. Campaigns in which the acceptability of certain ideas is promoted provoke actions in humans holding the same ideas. The idea of rational choice as the lead heuristic for understanding decision making should be replaces by the claim of nudge: that people reason based on cognitive shortcuts, social processes and motivations that are not just instrumental.

What evidence is there from social science that explains nudge in relation to human decision making?

There have been findings from social science on which the nudge approach is based.

First, cognitive pathways influence the way people make decisions. Humans have a fundamental problem in decision making because we are unable to process the available information and determine the consequences. This is because our cognitive capacity is limited. The decision-making process is therefore guided by habits of thought, rules of thumb and emotions. Several popular theories have emerged explaining this perspective.

• The social prospect theory (Kahneman and Tversky. 1979) states that decision makers that ownership of goods plays a significant role in the decision-making process. When people are afraid that they have something to lose, they apply strategies to prevent loss from occurring.

• Psychological discounting means that short-term effects weigh higher than long-term effects in decision making. Discounting is the behaviour in a less rational and consistent way in which we place hyperbolic discounting is applied. This leads to overweighting short-term consumption and discounting long-term effects.

• The prosperity to maintain a status quo means that people do not change their habits unless they are pressured to. A powerful mechanism that could help is the shifting to maximization of social welfare. This means to remove the active-decision choice and automatically enrol people into actions that support social welfare, for example pension savings programmes.

• The issue of cognitive consistency means that people aim to achieve consistency between behaviour and beliefs. If these two clash, it results in the uncomfortable feeling of cognitive dissonance. People are more motivated to change their behaviour to be consistent with their beliefs.

Secondly, social influences such as how we are seen by others alter our decisions. The technique of information disclosure makes people more likely to contribute to the community because they see others do it too. The visibility of individual actions therefore leads to the creation of social norms. Social context is important because it guides people in what behaviour is accepted or expected. When people are confronted by a situation and perceive ambiguity, they rely on the opinion of people they trust on social cures from people they trust and identify with. Important theories are theories of inter-group bias and the social capital theory.

• Theories of inter-group bias stress the importance of loyalty -and identification promoted by group membership. We look for a way to behave, or social proof.

• The social capital theory states that social networks that underpin social norms, such as trust, mutuality and reciprocity influence decision making. This is because obedience or disobedience to social norms can lead to approval or disapproval of the community.

The third are moral convictions. There are three forms of moral behaviour described by Goodin (1980).

• Prudential morality is an appeal to enlightened and long-term self-interest and is achieved by self-reflection.

• Internalized moral principles are given the same status as instrumental and self-interested motivations in decision making.

• Sacred moral principles require protection and shall not be traded under any circumstances.

How can nudges be translated into policy interventions?

Nudge-style insights can be used for designing successful policy interventions. Nudges that include social information, pledging and feedback were more effective. The tools that governments can use to shape their policies for behavioural change are described below.

• Framing is the way in which policy makers address context to encourage targeted groups to respond in certain ways. Framing is a top-down approach in which decisions are influenced by support and policy format. However, a lack of trust in the government may limit conveying the message.

• Persuasion is a technique in which people’s beliefs are consciously altered. Framing only changes the relative importance whereas persuasion is trying to change belief content. It is again a top-down technique where a clear capacity for delivery of a strong message is required. However, too many conflicting challenges or perspectives limit the capacity for shifting beliefs.

• Norm-creation is when the government is trying to create positive norms in society and specifically in social groups. It is a way of bottom-up influencing decision making and uses the ability to cede control. It also only works in an interactive partnership with citizens. Failing can occur when the government cannot provide time, space and support the citizen-led activities to promote norm-creation.

The researchers argument that their claims support the development of nudge strategies and their appliance, the use of conventional tools is needed as well. For financial purposes, health and authority, conventional tools are more useful in behavioural regulation. Nudge can bring in additional tools for changing consumer habits.