Helping people make better choices — Nudge Theory and Choice architecture

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Why people comply when they are nudged

Biases are hardwired and difficult to change. To change behavior, attention is not paid to countering the problematic thoughts, judgments, or predictions. Instead, it has been directed to changing the behavior in the form of incentives or "nudges."

For example, employers have been able to nudge employees into contributing to retirement plans by making saving the default option; you have to actively take steps to not participate.

The nudge theory

Behavioral economists show that when humans make quick decisions under pressure, it is based mostly on intuition. They are unconsciously guided by biases and psychological fallacies.

The nudge theory suggests making subtle interventions to nudge people to make certain choices without restricting them. Putting the fruit at eye level counts as a nudge.

Intuitive and reflective thinking

Intuitive and automatic: This kind of thinking is quick and feels instinctive. You duck when a ball is thrown at you unexpectedly.
Reflective and rational: This thinking is deliberate and self-conscious. You use this system when you have to decide which route to take for a trip.

The need for nudge theory: the Japanese example

Japanese train stations use nudge theory.

Blue lights improve the mood of commuters and reduce suicide attempts.
The door closing jingle lighten the highly stressed peak hour commute.
A high-frequency tone at station entrances reduce teenage loitering as the 17kHz can only be heard by people under 25 years.