Nudges and boosts as policy instruments - understanding behavioral interventions

Around the world, behavioral interventions, such as nudges, have gained a huge interest and special “nudge units” tailor interventions that encourage the “right” behavior by less intrusive measures than taxes or regulations.

In spite of the practical popularity, we still know very little about what mechanisms make nudges work in some cases but not in others. This project will increase our understanding in this respect. It consists of several theoretical and empirical studies that are strongly linked together. We will not only study nudges, but also the less known ‘boost’.

While a nudge affects an inattentive choice, a boost facilitates making an attentive (rational) choice.

We will both make positive analyses where we explain the mechanisms through which boosts and nudges work and normative where we study what is the optimal intervention, depending on the situation and whether one wants to correct an externality or an internality.Field experiments will accompany the theoretical work, which further increases our understanding of behavioral interventions also in practice.

While much of the existing literature on behavioral interventions has focused on short-term effects, this project will also study to what extent effects from nudges or boosts are persistent.

As behavioral interventions become more and more common in the policy makers’ toolkits, this research will be of both academic and practical importance.