Noodges and the Far Side of the Moon

The 3 book rule of thumb suggests that if you read 3 books on a subject, you will know more than 95% of people on the topic and might be considered an expert. How far does this strategy get you with behavioural economics? Misinformed and misguided, I’d argue. There is a bias for describing this, of course. You have the illusion of knowledge. Like with an astronomer staring up into the night sky with a naked eye for 3 consecutive years, the particular challenge with behavioural economics however, is that it is only the near side of the moon which is on view. Why?

Whether it be Nudge: Improving Decisions about Health, Wealth, and Happiness, Predictably Irrational, or Thinking Fast and Slow, the chances are high that, if you’re interested in behavioural economics, you have read at least one of these books. Your attention was tickled and interest delighted by illusions and examples of biases and heuristics from elegant research studies. Many of these same examples find application in public policy interventions, which serve to reinforce a common theme that small changes can have a big, positive impact. Set racing by novelty and self-insight, your recently weaponised thoughts are only momentarily slowed-down by the obligatory caution of libertarian paternalism - the possibility that nudges are not always obviously in the best interest of the object and the need to tread carefully.

This is a popular, well-worn narrative.

Expand your reading list to other books, online resources, YouTube content, blogs, TEDx talks, academic programmes, industry affiliations and – chances are – you’re going to have similar themes being reinforced. Behavioural economics, we are encouraged to believe, is primarily for insights into how people think and behave and for effecting large scale positive influence and change. A case in point: the OECD’s map on institutions applying behavioural insights to public policy.

The fact is that the public narrative on behavioural economics is almost entirely dominated and shaped by academics, government and non-government agencies, who have a vested interest in trumping up their own work. This sells books and speaking slots. It secures grants for research funding. And it secures a spot in the limelight, fame and professional accolades.

But what of quieter, unspoken voices? What of all the psychology and behavioural science grads who have been pumped into industry over the last century? What of the scientists deeply involved in behavioural work, who avoid public scrutiny? These same parties who operate in an unregulated vacuum and who are disincentivised from speaking of the work that they do?  What of the private sector companies secretly manipulating, for example, customers to buy compulsively hedonistic products or services against their better – System 2 – judgement? On this, the public narrative is unusually quiet.

Although there are some private sector businesses that openly declare their behavioural agenda, this is typically where win-win outcomes for the company and the underlying market are clear. Lemonade Insurance and the Vitality Group are good cases in point, and consistent with the thesis that bad nudges, or “noodges”, which are not in the obvious interest of the object are likely kept in the shadows.

When last did we see in flashing lights the remarkable achievements of the individuals who so tirelessly work on tweaking the machinations of gambling, for example? When last did we see lauded the remarkable achievements of the scientists who make our children slaves to gaming?

Mostly these individuals keep out of sight. Every now and then an exception pops up. Celia Hodent of Fortnite fame, for example, bucks the trend. So too do game designing legends like Shigeru Miyamoto (Super Mario Bros. and Pokémon) and Adam Saltsman (Canabalt).

Uber represents a good case study on the downsides of having one’s behavioural strategy being put up for review in the public domain.

In April 2017, the New York Times famously ran a lead article criticising Uber for its use of noodging to keep drivers on the road.Judging from the comments and the subsequent articles published in response, what offends is not so much the manipulation taking place but the fact that Uber profits from human weakness with disproportionately little benefit going to drivers. (Read: exploitation).

So, what is one to conclude from the public narrative on the behavioural sciences? 

Certainly nudging for good represents only one side of the moon, as it were. Less well understood is the far side of the moon, noodges or bad nudges, which for the most part lie out of plain sight. Although speculating around a hypothetical world has its challenges and runs a risk of being conspiratorial, we have the benefit of knowing that even rigorous sciences sometimes struggled with garnering sufficient evidence for pushing theory across the line, to fact. It took well over a century, for example, for Einstein’s theory of general relativity to be proven.

With the benefit of hindsight, my sense is that the extent and range of noodging will prove both blindingly obvious and shocking. For the moment however, we can only hypothesise and follow the smell of behavioural addictions and companies which enjoy sustained supernormal growth and profit.