Applying Behavioural Insights to Public Policy Simon Ruda
Outline 1. What are behavioural insights? 2. Who are the Behavioural Insights Team? 3. How can we apply behavioural insights to public policy?
What are Behavioural Insights? Psychology Understanding how people behave in practice so Behavioural Public Policy Ethnography that we can design policy better Insights (Behavioural) Economics
The suspect game
Suspect 1
Suspect 2
Suspect 3
The suspect game
Some random people
Can you see a suspect?
% False Identifications without suspect in line-up 30 25 20 15 10 5 0 Simultaneous + Warning + Suspect Sequential + Warning + Suspect Stebley et al. 2001
Contextual factors affect professional decision making Danziger et al. 2010
Contextual factors affect the biggest life decisions 6000 5000 4000 Annual suicides 3000 2000 1000 0 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 1975 1976 Year Clarke et al. 1988
We need to think differently about behaviour “It turns out that the environmental effects on behavior are a lot stronger than most people expect” Daniel Kahneman
“Our government will find intelligent ways to encourage, support and enable people to make better choices for themselves .”
The Behavioural Insights Team
We work across the full spectrum of Government policy Crime Justice Immigration Social Health Energy inequality Education Labour market Tax
Everyone hated us “David Cameron’s Vanity Project” UNCLASSIFIED 21
Press coverage
Current policy Behavioural Insights policy
Netherlands Finland Belarus (UNDP) UK Canada Germany Pakistan (DfID) Israel Moldova USA UAE (UNDP) India Jamaica Ukraine (UNDP) (UNDP) Singapore Mexico Montenegro (UNDP) Guatemala (World Bank) Ethiopia Oman (DfID) Peru Australia (World Bank) Brazil (World Bank)
Tax
Traditional policy levers Regulation Incentives Behavioural Insights Information
Criminal sanctions Financial penalties HMRC adverts
Nine out of ten people pay their tax on time
Social norms to increase tax payment rates within 23 days (1 month) 39,0% 37,2% 35,9% 35,1% 33,6% Control (8,558) UK Norm Local Norm Debt Norm Local + Debt (8,300) (8,403) (8,779) Norm (8,643)
Our UK tax trials brought Nine out of ten people pay their tax on time. forward an extra $320million in 12 months at zero marginal cost.
Different groups respond to different People with large debts react differently messages Loss-frame Owe $50,000+ 19.1% 12.1% 1.6% 1.5% Public gain (16,807) Public loss (17,159)
Behavioural Insights Team in Latin America • In Guatemala, tax revenue as a proportion of GDP is one of the lowest in the world Country 2012 Tax revenue (% of GDP) Guatemala 12% Nicaragua 18% Latin America 26% World Average 32%
BIT and the World Bank: Tax Compliance in Latin America Percentage of taxpayers that paid tax by letter received 43% increase 5,6% 5,4% 5,0% 4,4% 4,3% 3,9% Control Original SAT Behavioural Behavioural + Behavioural + Behavioural + Letter Letter National Pride Deliberate Social Norms Choice
Amount of tax received for each letter sent $24,62 $20,64 $16,16 $14,19 $6,82 $6,67 Control Original BIT letter BIT + National Pride BIT + Social Norms BIT + Deliberate Choice
Percentage of taxpayers who went on to make a payment the following year (with no further reminder) 5,0% 5,0% 4,5% 4,3% 4,3% 4,3% Control Original SAT Letter Behavioural Letter Behavioural + National Behavioural + Social Behavioural + Pride Norms Deliberate Choice
Giving money to charity
Increasing payroll giving inside government
The image of a colleague more than doubled the number of people who signed up 6,4% 2,9% Control Group Image
Proportion giving away a day’s salary to charity 17% 12% 11% 7% 5% Control Group Celebrity Sweets Personal email Sweets + Personal
Getting people back to work
‘Implementation intentions’ – helping people plan their actions
Proportion of people leaving social security benefits 56% 51% Control Treatment
After 39 weeks… 50% 45% 40% Employment Rate 35% 30% 25% 20% 15% 10% 5% 0% 0 13 26 39 Weeks Since Pilot Start Treatment Group Control Group
Increasing diversity of the police force
Treatment message The “affirmation boost”: “Before you start the test, I’d like you to take some time to think about why you want to be a police constable. For example, what is it about being a police constable that means the most to you and your community?”
Reflecting societal diversity in Police recruits Average test score Control 112,1 111,9 Treatment 110,5 105,9 Non-BME BME
Re-shaping consumer markets
Re-shaping markets
Re-shaping markets 2. Switch & save 1. Scan your bill
www.behaviouralinsights.co.uk
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