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Tag: psychology

Nudges won’t save us

Few theories have grabbed my imagination the way behavioral economics has, and I’m not alone in that. One of the big stories when President Obama was elected was that his administration was going to use behavioral economics to painlessly solve a variety of problems. Last week, economics professors George Loewenstein and Peter Ubel wrote an op-ed for the New York Times throwing some water on the idea that we can nudge our way into solutions for big problems. Here’s the conclusion:

Behavioral economics should complement, not substitute for, more substantive economic interventions. If traditional economics suggests that we should have a larger price difference between sugar-free and sugared drinks, behavioral economics could suggest whether consumers would respond better to a subsidy on unsweetened drinks or a tax on sugary drinks.

But that’s the most it can do. For all of its insights, behavioral economics alone is not a viable alternative to the kinds of far-reaching policies we need to tackle our nation’s challenges.

For what it’s worth, studies show that taxes are more effective than subsidies in changing people’s behavior.

The psychology of fast food

A study by researchers at the University of Toronto shows that fast food makes us impatient:

Eating habits have shifted dramatically over the last few decades–fast food has become a multibillion dollar industry that has widespread influence on what and how we eat. The original idea behind fast food is to increase efficiency, allowing people to quickly finish a meal so they can move on to other matters. Researchers at the Rotman School of Management, however, have found that the mere exposure to fast food and related symbols can make people impatient, increasing preference for time saving products, and reducing willingness to save.

This makes me think about the more general inefficiency of being in a hurry. Rushing to get things done often results in a bad job, and promotes disorganized thinking that in the end costs you more time than hurrying was supposed to save. I hurry a lot, but I am trying to get better about it.

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