What is nudge?

Nudge Theory: Steering Choices for the Better

Nudge theory, as popularized by behavioral economist <a href="https://www.wikiwhat.page/kavramlar/Richard%20Thaler">Richard Thaler</a> and legal scholar <a href="https://www.wikiwhat.page/kavramlar/Cass%20Sunstein">Cass Sunstein</a> in their 2008 book Nudge: Improving Decisions About Health, Wealth, and Happiness, proposes that subtle changes in the way choices are presented can significantly influence people's behavior without restricting their freedom of choice. It is a concept within <a href="https://www.wikiwhat.page/kavramlar/Behavioral%20Economics">Behavioral Economics</a>, suggesting that by understanding cognitive biases and heuristics, we can design "choice architectures" that gently guide people towards better decisions for themselves and society.

Key aspects of nudge theory include:

• Choice Architecture: This refers to the design of environments in which people make choices. Nudges work by altering aspects of this architecture, such as the order of options, the wording used, or the visual presentation.

• Libertarian Paternalism: This guiding principle suggests that it is possible to design policies that are both respectful of individual liberty and paternalistic in the sense that they aim to improve people's well-being. The "libertarian" aspect ensures individuals are free to choose, while the "paternalistic" aspect implies that designers have a legitimate interest in influencing choices in a beneficial direction.

• Nudges vs. Mandates: Nudges are distinct from mandates or regulations. They do not forbid or force specific behaviors but instead make it easier or more appealing to choose certain options.

• Applications: Nudge theory has been applied to a wide range of areas, including <a href="https://www.wikiwhat.page/kavramlar/Public%20Health">Public Health</a> (e.g., encouraging healthier eating), <a href="https://www.wikiwhat.page/kavramlar/Finance">Finance</a> (e.g., increasing retirement savings), and <a href="https://www.wikiwhat.page/kavramlar/Environmental%20Sustainability">Environmental Sustainability</a> (e.g., promoting energy conservation).

• Examples of Nudges: Common examples include:

  • Default Options: Automatically enrolling employees in a retirement savings plan (with the option to opt-out).
  • Framing: Presenting information in a way that highlights potential gains or losses.
  • Social Norms: Highlighting the behavior of others to encourage similar behavior (e.g., "Most people in your neighborhood are conserving energy").
  • Simplification: Reducing the complexity of choices to make them easier to understand.

Nudge theory has faced criticism, with some arguing that it can be manipulative or that its effects are often overstated. However, it remains a prominent and influential framework for understanding and influencing decision-making in various contexts.