A Practitioner’s Guide to Nudging

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FIGURE 1 A DECISION MAP WITH BOTTLENECKS IDENTIFIED Not enough money for savings Recognize the importance of retirement savings Allocate money for retirement Open retirement account Select investment fund Monitor investment returns Reallocate money as needed Retirement too distant and irrelevant Difficult to decide contribution amount Too many choices salience of retirement planning, credit unions might try to reach a member during a key life event, such as when they start caring for an aging parent. To convince members that every bit helps, no matter how little, a credit union might form a savings circle and use text messages to let them keep tabs on their peers. To minimize stress around selecting an investment fund, a credit union might narrow the range of choices given the member’s risk profile. This is all very helpful, but the guide has a more ambitious goal: to convince readers that the audit process can be applied to almost any decision. For credit unions, it could be used to think through the steps that members take when they decide to buy a car, purchase a home, choose a credit card, purchase an insurance policy, or save. For individuals like me, it could be used to figure out why I don’t use my gym membership nearly as much as I should, or why I always put off mowing the lawn, or why I . . . what was that other thing I needed to do? Oh yeah, that’s right, not forget things. PAGE 6 EXECUTIVE SUMMARY FILENE RESEARCH INSTITUTE
A Practitioner’s Guide to Nudging CHAPTER 1 Nudging: An Introduction Nudge: to seek the attention of by a push of the elbow. To prod lightly. Urge into action. —MERRIAM-WEBSTER.COM Nudge: Improving Decisions About Health, Wealth, and Happiness is the title of a 2008 book written by Professors Richard Thaler and Cass Sunstein. 1 The book introduces the notion of choice architecture and draws on findings from behavioural economics. Consider two cafeterias that want to help students consume less junk food. One cafeteria decides to attack the problem by placing a “tax” on junk food or by banning the sale of junk food altogether. 2 The other cafeteria decides to change its food display so that junk food will less likely be chosen. Junk food will be placed on higher, harder-to-reach shelves while healthy foods will be placed at eye level and within arm’s reach. Both cafeterias are trying to influence behaviour but are using two entirely different methods. The first cafeteria is influencing behaviour by either financially incentivizing students to choose healthier PAGE 7 NUDGING: AN INTRODUCTION FILENE RESEARCH INSTITUTE
Page 1 and 2: REPORT A Practitioner’s Guide to
Page 3 and 4: Table of Contents 4 EXECUTIVE SUMMA
Page 5: practitioners can use to reevaluate
Page 9 and 10: In this report, we use the term “
Page 11 and 12: These four dimensions combined resu
Page 13 and 14: The results showed that the high-tu
Page 15 and 16: A Planning Aid to Increase Savings
Page 17 and 18: successful; in its first five month
Page 19 and 20: used, the Waterpebble automatically
Page 21 and 22: Select the Nudge Bottlenecks in the
Page 23 and 24: Identify the Levers for Nudging Ide
Page 25 and 26: possible, we recommend that it be a
Page 27 and 28: FIGURE 14 MINDSPACE FRAMEWORK Messe
Page 29 and 30: APPENDIX 2 Decision Map Checklist P
Page 31 and 32: Block FAFSA Experiment, National Bu
Page 33 and 34: 22 FIGURE 13 BEHAVIOURAL INFLUENCES
Page 35 and 36: Dilip Soman Rotman School of Busine

A Practitioner’s Guide to Nudging

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