PUBPOL 201 Study Guide - Final Guide: Status Quo Bias, Libertarian Paternalism, Choice Architecture
Document Summary
Why are people and not econs nudge-able: econs: rational all the time and respond to incentives b/c they understand repercussions, people have biases and automatic system, need nudges instead of incentives. Nudge : any aspect of the choice architecture that alters people"s behavior in a predictable way without forbidding any options or significantly changing their economic incentive. easy and cheap to avoid. Not a mandate: an incentive works by rationally changing the best option. work b/c we are irrational: non-rational factors, like the order in which options are displayed, or when an option is given, affect us. Using frame of mind that you"re familiar with/ first one you see (listing donations so they give more). You start with some anchor, the number you know, and adjust in the direction you think is appropriate. Bias occurs b/c the adjustments are typically insufficient: availability: Assess the likelihood of risks by asking how readily examples come to mind.
