Defaults and ethics of nudging

Defaults give us an opportunity to reflect on the ethics of nudging, a hugely important topic in behavioural science.

The classic libertarian paternalist argument is that defaults do not strictly take away any choices. On the other hand, we know they are going to have an impact on behaviour, so we have to think about whether we have the right to change behaviour, and whether we are changing it in a way that is transparent and beneficial for the person being nudged.

One way of thinking about nudging is to ask if the person who is being nudged would consent to the nudge if they were told about it. If a nudge has to be hidden, is deceptive, or is obviously insidious then we may want to ask questions about whether we have the right to nudge at all. Social statistician Andrew Gelman summarises the golden rule of nudge as “Nudge unto others as you would have them nudge unto you.”

Behavioural scientists have been grappling with these questions and one of the recent innovations has been the FORGOOD framework developed by Lades and Delaney (2020). This mnemonic (yes, MINDSPACE has inspired others) is designed to translate the ethical debates taking place within behavioural science into a practical and systematic tool for policymakers.

FORGOOD urges us to nudge in ways that reflect seven key criteria:

1. Fairness. Does the behavioural policy have undesired redistributive effects?
2. Openness. Is the behavioural policy open or hidden and manipulative?
3. Respect. Does the policy respect people’s autonomy, dignity, freedom of choice and privacy?
4. Goals. Does the behavioural policy serve good and legitimate goals?
5. Opinions. Do people accept the means and the ends of the behavioural policy?
6. Options. Do better policies exist and are they warranted?
7. Delegation. Do the policy-makers have the right and the ability to nudge using the power delegated to them?

This comprehensive checklist stops us from suffering from situational blindness and forgetting to ask difficult questions about why we are nudging, the likely effects, and whether we have a right to change behaviour in the first place. We can illustrate the use of FORGOOD with the now-familiar example of savings defaults:

1. Fairness. Saving may have undesired redistributive effects if people are not saving the amount they would like because the default option doesn’t suit them.
2. Openness. Savings defaults can be obvious when displayed in apps or bank statements, but may also be hidden, for example, if pensions are taken out of your pay without you realising. They need to be communicated clearly at all times.
3. Respect. Savings defaults do not take away the freedom to choose how much to save, and nor do they interfere with any basic rights.
4. Goals. The goal of increasing savings is one that hopes to benefit people and pension systems over the long term, which is “good and legitimate”.
5. Opinions. As people generally say they’d like to save more and regret spending too much, defaults can be assumed to reflect peoples’ opinions, but people must be consulted continually.
6. Options. It’s possible that incentives and better-designed pensions systems could supplement or replace defaults. However, as defaults have such large effects it is likely they have among the highest benefit to cost ratios.
7. Delegation. This varies from place to place, but generally, both employers and the state are considered responsible for pensions to some degree.

Overall, savings defaults pass most of the criteria in the FORGOOD checklist, though concerns about over-or under-saving are the most pressing. It seems that savings nudges in the future may need to find ways to determine if people are at their optimal savings rates, perhaps with individual-specific defaults.

Discuss

Who has the right to change behaviour? Is there an argument against nudging at all?

References

^{1. Lades LK, Delaney L. Nudge FORGOOD. Behavioural Public Policy. 2020:1-20.}