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July 23, 2008

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John

Richard Layard is the perfect nudger. His ideas on depression
http://cep.lse.ac.uk/layard/psych_treatment_centres.pdf

not only nudges people to have therapy if they are depressed but at the same time advertises the heavily branded therapy (CBT) thus promoting a industry based on one single type of therapy (probably not to the liking of the Pharmacutical companies). Of course this is done under the umbrella of NICE guidelines to fit into a language of state rationality.

Layard's nudging fits nicely into Nikolas Rose's Foucauldian critique of the over use, or mass creation of mental illness'(ie Post tramatic stress disorder - PTSD). Rose explains that we become accustomed to living in a confessional society. Although Rose's negativity is central to this concept (and actually to most of his other work), he does have a point.

Will Davies

I think Rose would probably plead that there was nothing normative about his analysis at all. Critical, maybe, but in the sense of 'critique', not in the sense of 'negative'.

max

I went to one of the many seminars in last week's Nudge-athon. Afterwards I wrote down the following:

1) Prohibition
2) Regulation
3) Incentives
4) Information
5) Direct and indirect provision

This is a basic typology of government intervention from any Public Economics textbook. If we start here, Thaler and Sunstein are basically saying: 1) and 5) are bad ways of structuring behaviour. 2), 3) and 4) are good. It then provides some helpful hints on the detail of policy design - defaults matter, give feedback, expect error etc.

As you say, we already know a lot of this from other disciplines (and common sense). Nudging is new in economics, though. And economists would say that because economics is good at building robust models and generating measurable outcomes, a better economics is good for policy.

The bigger problem with Nudging as a policy instrument is that we actually don't know what nudges work in most cases. In the seminar, Thaler claimed that the costs of finding out are pretty cheap, compared to (say) the Supercollider at CERN. But if you think about it, the financial, political and moral costs of experimenting with nudging (say) public health policies in different directions could be pretty high.

Nudge is a great meme. And because it's largely based on lab experiments it feels pretty clean and neat. But back in the real world I'm not sure how far it can or should take us.

Will Davies

Yes, all sounds sensible.

So maybe the issue is that, while there are plenty of areas of society that involve altering behaviour via irrational instincts, that none of these are currently of great socio-political significance. If an advertising strategy or HR policy fails, the worst that can happen is that someone doesn't buy a car or they quit their job. Whereas, like you say, the responsibilities of the state are a lot weightier than that, and hard, statistical modelling becomes necessary. Lab experiments aren't up to the job.

I've never studied stats in my life, but I presume it's pretty hard to imagine NHS statistics having data about how groups 'tend' to behave pumped into them...

John

Not sure about Rose. Foucault brilliantly used the critique without being negatative, sadly many use Foucault, including Rose, to see society primarily from a negative slant.

Wendy Ragiste

I dread to think what the competing parties will get up to with this at the centre of their advertising campaigns for the forthcoming election.

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