Use of Behavioral Sciences in Public Policy

By Muhammad Arfan

There is a general criticism on public policy that it does not work and bad in compliance, especially in the developing world. The cause of its failure has remained part of the research agenda for policy analysts—during the 21st century. During the 21st century, policy analysts started revisiting the traditional design of policy approaches. Traditional policy design is limited to economists, lawyers, and financial experts, which depend mainly on the insight of subject matter experts, such as energy, water, and healthcare specialists. The emergence of behavioral sciences is now providing behavioral insight as a tool for public policy. Behavioral scientists provide policy insight by studying populations, spending, saving, eating, and working habits in Randomized Control Trials (RCTs). These sorts of empirical research provide a way to hypothesize and explain how humans apply logic or what appears to be rational.

The OECD estimates that more than 200 public sector organizations worldwide have applied behavioral expertise to their work. As we all know, humans are an intricate animal; their behavioral responses can be surprising and sometimes hard to predict precisely. The task is to evaluate and revisit behavioral predictions in multiple situations to ensure we do not just substitute a defective behavioral model with another. Based on these behavioral insights, policymakers construct nudges to influence human behavior.

In Singapore, they have nudged people to reduce their water usage and take public transport to work. In France, they have nudged people to adopt energy-efficient practices and to undertake physical activity. In Australia, the healthcare department used it to reduce the misreporting by doctors in after-hours patients and tagging patient urgent because the government has a reimbursement policy for an urgent after-hours care visit was more than double the reimbursement for a non-urgent visit. The government identified 1200 doctors who reported more urgent care visits after hours compared to their peers. Each doctor was sent a letter, one of three alternative letters that were randomly selected. One letter had contrasted the doctor’s accounting activities with her colleagues and showed that she was even more urgent than others.

This has drawn from the understanding that people are always driven to improve their actions when they know they are not in line with their peers. The second letter emphasized the implications, including administrative fines and legal action, of non-compliance. This letter was based on the behavioral idea that people care about losses more as compared to gains. The control was the third message. It was a typical letter of bureaucratic conformity – three pages long. Which letter was the most successful? The first letter was more successful, and claims decreased by 24%.

Even though the behavioral insight was dubbed a “quiet revolution” embraced by the political spectrum, it was also a subject of many critiques. The criticism can be categorized into its conceptualization, methodology, ethical, and ideological implications. Critics say nudges cannot understand the complex policy landscape and are considered an inappropriate route to address the causes of policy problems. Additionally, from moral or ethical standpoint nudges perceived as ethically awkward because it provides the behavioral insight which policymaker want to see rather than connecting with citizens’ actual inclinations in any meaningful way.

Keeping in view this criticism, Cass Sunstein drafted five rules to ensure that it is used ethically. Sunstein’s five rules are that nudges must:

• be consistent with people’s values and interests,
• be for legitimate ends,
• not violate anyone’s rights,
• be transparent, and
• not take things from people without consent.

We are still very much in the early days, which means this is just the cornerstone to educating and encouraging future generations of scholars, lawmakers, and public administration leaders. If change continues, it will be an increasingly relevant refrain between those interested in creating how overall goals are established and targeted in society. Thus, we can align our interventions consistently with the most important local, national, and global communities.