Behavioural Public Policy

Behavioural Public Policy

Since the publication of Richard Thaler and Cass Sunstein’s book Nudge: Improving Decisions About Health, Wealth, and Happiness, the government has been keen to use evidence from behavioural economics to influence public policy in areas such as health, the environment and education; in 2011 David Cameron even introduced a so-called ‘Nudge Unit’ into Number 10. Here it is questioned whether behavioural insight is a passing trend, whether the state has any business trying to influence individual behaviour, and how ‘nudging’ could produce tangible benefits in health, the environment, education and other areas.

Auto-enrolment is not the end of the pensions story

The government introduced legislation requiring employers to auto-enrol their workers in pension schemes, hoping that this ‘nudge’ will reduce the pensions gap – the difference between retirement savings and the minimum amount a pensioner will need to avoid poverty. Sandy Pepper summarises research suggesting otherwise. In the majority of cases, auto-enrolment contributions will not be high enough to provide the level […]

The long reach of childhood bullying: Unemployment hurts, but it hurts more for individuals who had a persistent negative experience as a child

Does the fear of being bullied in childhood affect people’s resilience to adverse life events they may face in adulthood? Nattavudh Powdthavee investigates whether the ‘scarring’ effects are particularly damaging to individuals who lose their job. Research on the economics of happiness has shown that, on average, people of working age who are unemployed report significantly lower mental health and […]

Human wellbeing follows a U-shape over age, and unmet aspirations are the cause

A large literature in behavioural and social sciences has found that human wellbeing follows a U-shape over age. Some theories have assumed that this is caused by unmet expectations that are felt painfully in midlife but abandoned with less regret during old age. In a unique panel of 132,609 life satisfaction expectations matched to subsequent realizations, Hannes Schwandt presents findings […]

To reduce work’s importance to a feeling of pain is to miss the fundamental role of work in the fulfilment of our needs both as consumers and producers

The recent finding that we work simply for money and that work makes us “unhappy” may be headline-grabbing, but it does not speak to the role that work can and ought to play in human life. David Spencer addresses the deeper importance of work in human life. Why do we work? Just for the money? Or do we also work for other reasons […]

Whistling while you work: Happiness is good for productivity

Through a series of experiments, Daniel Sgroi and colleagues examine the relationship between happiness and productivity. They find that a shock to wellbeing, whether short-run and minor or long-run and significant, definitely has effects and these effects are positive and pronounced. While there may be other routes, the effect of a wellbeing shock on focus and worrying is one feasible story […]

Does money buy happiness? It depends on the context

Ilka Gleibs explains how the money–happiness link is variable and highly context-dependent. Two studies she conducted showed that both money (individual income) and community (social capital) can be the basis for individual happiness, and that the relative influence of each factor depends on the context. She argues that strong social relations are much more consistent in providing us with well-being and […]

A better understanding of the behavioural constraints that people face will help policy makers to more effectively target public policy interventions that aim to change their actions.

Government interventions often have very different outcomes to those desired by policy makers. Joan Costa Font argues that the development of behavioural economics offers a means to more thoroughly examine the behavioural constraints faced by those who are targeted by specific policies. Behavioural economics is not only better equipped to account for failures but if applied to public policy, it […]

Attempting to create scientific and objective tests to measure national wellbeing may be less effective than just asking people how happy they feel

Since David Cameron announced his intention to measure the country’s happiness in 2010 there has been a flurry of debate about whether happiness is something that can or should be measured. Robert Battison examines the Office of National Statistics’ latest exercise in finding objective measurements for happiness, and suggests that simply asking people whether they are happy or not might […]