Cass Sunstein: prediction

Transcript context

…Right, but say it is. Just pay them more. In Denmark, economic incentives have had significantly less effect in promoting savings than automatic enrollment. There’s every reason to believe that in an area that isn’t, you know, hugely important but isn’t trivial — that is, paper usage — if you have a double-sided default for printing, an institution will save much more money than if it jacks up — than if the price of paper is jacked up. Often a little nudge changing the default rule, giving some people some information, will have a very significant effect on behavior, more so than tax incentives or other economic incentives. And that’s good, by the way, partly because on the cost side it’s much less; you’re not sticking the taxpayers with anything. On the other hand, there are some domains where incentives have a bigger effect. We have evidence that taxes for cigarettes have a big impact in reducing smoking. I think presumptively that’s a very good idea — 480,000 Americans die every year; if we can cut that number, that’s a good thing. Whereas the warnings we now have on cigarettes seem to be less effective than increasing the incentive not to smoke. Let’s take a concrete example from real life: Jedi mind tricks. Obi-Wan comes along and says, “These aren’t the droids you’re looking for.” And what does the stormtroooper do? He goes away. Now, is that a nudge?…

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