Financial Times FT.com

The dramatic effect of a firm nudge

By Cass Sunstein and Richard Thaler

Published: August 12 2008 19:36 | Last updated: August 12 2008 19:36

In the past three decades, psychologists and behavioural economists have learnt that people’s choices can be dramatically affected by subtle features of social situations. For example, inertia turns out to be a powerful force. If people’s magazine subscriptions are automatically renewed, they renew a lot more than if they have to send in a renewal form. Moreover, people are influenced by how problems are framed. If told that salami is “90 per cent fat-free” they are far more likely to buy salami than if they are told it is “10 per cent fat”.

Ask the Experts

Cass Sunstein

Can big changes to behaviour be achieved through subtle social persuasion? Cass Sunstein (above) and Richard Thaler (below), answered your questions in a Q&A.

Social norms matter a lot. If people think others are recycling, or paying their taxes, they are far more likely to recycle and to pay their taxes. The important message is that small details can induce large changes in behaviour.

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