The “nudge” school of behavioral economics shot to prominence in 2008 with a book of that name by Cass Sunstein and Richard Thaler. (Thaler went on to win a Nobel Prize for his contributions to the field.) Their theory: Policies that gently encourage — or nudge — people to make good choices can succeed better than legislative decrees. For instance, if we cleverly design a homeowner’s utility bill to show her that neighbors are using less energy, maybe she’ll act a little greener too. Nudge theory rocketed from academia to governments around the world because it seemed to offer a path to liberal outcomes, like better road safety, with none of the heavy-handed regulation that conservatives despise.
In IT’S ON YOU: How Corporations and Behavioral Scientists Have Convinced Us That We’re to Blame for Society’s Deepest Problems, the idea gets a thorough takedown. Loewenstein — another foundational figure in behavioral economics — and his co-author Chater, a professor of behavioral science, write that nudges simply don’t work as advertised. Two of the most highly touted nudges involve automatically enrolling workers in retirement plans and making organ-donor registries opt-out by default. Both policies seemed to produce immediate gains, but follow-up studies have found they have little lasting impact.