Magazine article Kennedy School Review

Motivated by the Masses: Social Information as a Policy Tool

Magazine article Kennedy School Review

Motivated by the Masses: Social Information as a Policy Tool

Article excerpt

THOMAS EDISON, the pioneering American inventor, was not much of a sleeper--he claimed to sleep no more than four hours a day. (1) Undoubtedly, few people today would willingly adopt his sleep schedule, given the documented adverse health effects of sleep deprivation (at least for most of us). (2) Notably, Harvard Medical School studies suggest that sleeping less than six to eight hours per night can cause a variety of health problems--decreased productivity, impaired judgment, and workplace accidents. (3) But let's imagine for a moment if, in today's researchdriven society, there was not much research on the impact of sleep deprivation. Imagine all we had was a single case study: Thomas Edison, a prolific inventor who did not sleep. Surely, public policy around work and leisure would be quite different.

Fortunately, policymaking is increasingly guided by evidence from research and not anecdotes about inventors. The growing emphasis on evidence-based policy has turned many policymakers toward behavioral economics, a field that explores humans' systematically irrational behavior. Many of the policy suggestions stemming from behavioral studies are simple, intuitive, and cost-effective, offering real guidance for policymakers. A notable example is "Save More Tomorrow," an intervention developed by behavioral economists Richard Thaler and Shlomo Benartzi to tackle the problem of insufficient savings. (4) The program, tested at three firms, offered employees the option to commit in advance to allocating a portion of future pay increases to retirement savings. The intervention had a major impact, inducing far more employees to save (and save more) for retirement then they had previously.

However, research that tests behavioral concepts in the real world is relatively new, and many published experiments only provide evidence for interventions in very specific contexts. In many cases, the available evidence is insufficient to make sweeping claims about the underlying dynamics of human responses to behavioral interventions. Thus, policymakers should be wary of overgeneralizing the results of a single study.

One subfield of behavioral economics research, social information motivation (the idea that individuals are influenced by information about the behavior of those around them), is a useful case study. The existing research in this area is increasingly influencing decision makers in both the private and public sectors. However, while the academic results that get the most headlines emphasize the efficacy of social information, there are many unanswered questions and mixed results. Policymakers seeking to use social information as a policy tool must assess the nuances of these results, which reveal that social information can backfire in ways that have serious consequences for policy.

SOCIAL INFORMATION

Studies suggest that information about others' actions or beliefs can be a powerful motivator. This idea has its roots in psychology and sociology. Simply put, social information gives people something to latch onto when making a decision, allowing them to more easily decide how to behave. Social scientists put this to the test in the real world, hoping to better understand how social information influences decision making. For example, a 2008 study tested the impact of social information on towel reuse in hotels. The researchers found that in-room messaging claiming that 75 percent of hotel guests reused their towels increased towel reuse by 44 percent relative to a message about the importance of environmental protection. (5) A similar 2013 study tested social norms in a grocery store. The study found that learning that others believe using shopping bags is a worthwhile way to help the environment decreased the number of plastic bags used. (6) These simple studies offer valuable insight into the effects of social information on everyday decisions.

Studies like these have allowed social information to gain traction among policymakers as a low-cost way to change behavior. …

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