Is it ok to use data for good?

You are nudged when your power bill says most people in your neighbourhood pay on time. When your traffic fine spells out exactly how the speed limits are set, you are nudged again.

And, if you strap on a Fitbit or set your watch forward by five minutes so you don’t miss your morning bus, you are nudging yourself.

“Nudging” is what people, businesses, and governments do to encourage us to make choices that are in our own best interests. It is the application of behavioural science, political theory and economics and often involves redesigning the communications and systems around us to take into account human biases and motivations – so that doing the “right thing” occurs by default.

The UK, for example, is considering encouraging organ donation by changing its system of consent to an “opt out”. This means when people die, their organs could be available for harvest, unless they have explicitly refused permission.

Governments around the world are using their own “nudge units” to improve the effectiveness of programs, without having to resort to a “carrot and stick” approach of expensive incentives or heavier penalties. Successes include raising tax collection, reducing speeding, cutting hospital waiting times, and maintaining children’s motivation at school.

Despite the wins, critics ask if manipulating people’s behaviour in this way is unethical. Answering this question depends on the definition of nudging, who is doing it, if you agree with their perception of the “right thing” and whether it is a benevolent intervention.

Harvard law professor Cass Sunstein (who co-wrote the influential book Nudge with Nobel prize winner and economist Professor Richard Thaler) lays out the arguments in a paper about misconceptions.

Sunstein writes in the abstract:

“Some people believe that nudges are an insult to human agency; that nudges are based on excessive trust in government; that nudges are covert; that nudges are manipulative; that nudges exploit behavioural biases; that nudges depend on a belief that human beings are irrational; and that nudges work only at the margins and cannot accomplish much.

These are misconceptions. Nudges always respect, and often promote, human agency; because nudges insist on preserving freedom of choice, they do not put excessive trust in government; nudges are generally transparent rather than covert or forms of manipulation; many nudges are educative, and even when they are not, they tend to make life simpler and more navigable; and some nudges have quite large impacts.”

However, not all of those using the psychology of nudging have Sunstein’s high principles.

Thaler, one of the founders of behavioural economics, has “called out” some organisations that have not taken to heart his “nudge for good” motto. In one article, he highlights The Times newspaper free subscription, which required 15 days notice and a phone call to Britain in business hours to cancel an automatic transfer to a paid subscription.

“…that deal qualifies as a nudge that violates all three of my guiding principles: The offer was misleading, not transparent; opting out was cumbersome; and the entire package did not seem to be in the best interest of a potential subscriber, as opposed to the publisher”, wrote Thaler in The New York Times in 2015.

“Nudging for evil”, as he calls it, may involve retailers requiring buyers to opt out of paying for insurance they don’t need or supermarkets putting lollies at toddler eye height.

Thaler and Sunstein’s book inspired the British Government to set up a “nudge unit” in 2010. A social purpose company, the Behavioural Insights Team (BIT), was spun out of that unit and is now is working internationally, mostly in the public sector. In Australia, it is working with the State Governments of Victoria, New South Wales, Western Australia, Tasmania, and South Australia. There is also an office in Wellington, New Zealand.

BIT is jointly owned by the UK Government, Nesta (the innovation charity), and its employees.

Projects in Australia include:

Increasing flexible working: Changing the default core working hours in online calendars to encourage people to arrive at work outside peak hours. With other measures, this raised flexible working in a NSW government department by seven percentage points.

Reducing domestic violence: Simplifying court forms and sending SMS reminders to defendants to increase court attendance rates.

Supporting the ethical development of teenagers: Partnering with the Vincent Fairfax Foundation to design and deliver a program of work that will encourage better online behaviour in young people.

Senior advisor in the Sydney BIT office, Edward Bradon, says there are a number of ethical tests that projects have to pass before BIT agrees to work on them.

“The first question we ask is, is this thing we are trying to nudge in a person’s own long term interests? We try to make sure it always is. We work exclusively on social impact questions.”

Braden says there have been “a dozen” situations where the benefit has been unclear and BIT has “shied away” from accepting the project.

BIT also has an external ethics advisor and publishes regular reports on the results of its research trials. While it has done some work in the corporate and NGO (non-government organisation) sectors, the majority of BIT’s work is in partnership with governments.

Braden says that nudges do not have to be covert to be effective and that education alone is not enough to get people to do the right thing. Even expert ethicists will still make the wrong choices.

Research into the library habits of ethics professors shows they are just as likely to fail to return a book as professors from other disciplines. “It is sort of depressing in one sense”, Braden says.

If you want to hear more behavioural insights please join the Ethics Alliance events in either Brisbane, Sydney or Melbourne. Alliance members’ registrations are free.