Old Problems & New solutions.

Published: September 25th 2016
Written By : Ronak Pol

In the last week’s article, we explored how behavioural science is used to serve corporate interest (read here). But behavioural research can also be used by policymakers to solve pressing policy problems, problems that have plagued our society over the years but have not been solved through traditional policy intervention.

The traditional policy approach to solving problems is providing infrastructure to deal with the issue, this is a supply sided approach to solving problems. Over the year’s policy makers have assumed that lack of infrastructure is the problem and providing it would solve the problem. But is that really true?

As Kaushik Basu, the World Banks chief economist puts it  “Standard economic policies are effective only after the right cognitive propensities and social norms are in place.” and there is growing support to implement a behavioural centric approach to policy making.

In this article, we will talk about some simple policy issue that are now being tackled with the help of behavioural science.

Railway Crossings and Public Policy.

Indian Railways reports that nearly 15000 people die every year while crossing tracks, of which nearly 6000 death occur in Mumbai Suburbs. It is natural to attribute these deaths to poor infrastructure conditions making building more infrastructure(overhead crossing & barricades) the standard policy prescription. Now if you are a Mumbaikar travelling by train every day, chances are you have already seen these small infrastructure changes materialise – but does that mean that we have now solved the problem?

Even through continuous efforts by the railway department we have not seen the death numbers drop, clearly indicating that the problem was not the lack of infrastructure but the missing usage. Research by Final Mile, a Mumbai-based firm, suggests that using fictionalised photographs of a person getting run over by a train reduced incidences of railway-related deaths by nearly 70% (1).

The success of this approach hinges on two important factors; big behavioural problems don’t need fancy solutions with large budgets and huge resources, but a fundamentally different approach that is designed on the unconscious and secondly on the fact that it is possible to change behaviour of people without them even being aware of the fact that we are changing their behaviour – This is the big idea (2).

Sanitation and Public Policy

Solving behavioural bias against using infrastructure is something that takes time and needs targeted policy action and the prime example of behavioural bias against using infrastructure is found with the sanitation problem.

First with the Green India initiative and now with the Swatch Bharat Mission, solving open defecation has been on the hands of the Indian Government for a while now. Over the years government has tried to make our cities cleaner and more hygienic but has failed on many counts. So why do people not use toilets and choose to defecate in the open?

  • There is the standard rational that people do not have the infrastructure (toilets) and hence defecate in the open. This warrants a state-funded scheme where building toilets is subsidised and at times free. Hence ideally solving the problem.
  • The other view is a behavioural approach where we analyse “Will people use toilets if they were state funded?” if not – then why not? and take policy steps to solve this problem first.

A comprehensive study done by R.I.C.E  institute in over 3,200 households in rural Uttar Pradesh, Madhya Pradesh, Rajasthan, Bihar, and Haryana found that people in rural north India very often do not use, and definitely do not share, their latrines. Meaning that building new toilets will not solve the problem and there is a need to change the behavioural bias against using latrines. (read here)

A very informative article on this topic is written by  Adrien Couton, Romit Mehta and Ahmed Nadeem Khan of Dalberg and is a must read for anyone interested in exploring a behavioural approach to Sanitation. (Read here)

Findings from these two studies clearly highlight the fact that success in curbing open defecation can only be achieved by generating demand for toilets through a consistent focus on behaviour change. Infrastructure-focused programs are by themselves inadequate in solving the problem of open defecation. The Indian government needs to remember this lesson as it embarks on an ambitious path to provide a toilet to every household.

Nudge units around the world

Nudge Units.jpg

Behavioural research units are being set up around the world to solve pressing policy problems. As US President Barack Obama puts it – “A growing body of evidence demonstrates that behavioural science insights — research findings from fields such as behavioural economics and psychology about how people make decisions and act on them — can be used to design government policies to better serve the American people…”

In America, the research unit is called “Social and Behavioural Sciences Team”(SBST) and includes leading behavioural scientists and innovators from across the country. SBST pilots led to a 53 percent increase in workplace savings by military service members and resulted in more than 4,800 new enrolments and over $1 million dollars in additional savings in just one month; a 63 percent increase in the rate at which small family farmers obtained small-business loans; and a doubling in the rate at which student loan borrowers in default contacted default-resolution representatives. (3)

United Kingdom has its own unit called “The Behavioural Insights Team” which is redesigning public services and drawing on ideas from the behavioural science literature. (4).They undertake highly empirical studies and use RCT design to carry out academic research. A similar research unit is being set by the World Bank to aid its efforts in fighting poverty.

The government’s think tank NITI Aayog has tied up with the Bill & Melinda Gates Foundation to set up a ‘nudge unit’ that will work towards bringing about behavioural changes and recommending policy corrections to help make the programmes more effective(5). There are exciting times for any behavioural scientist in India.

Conclusion.

Behavioural research will prove to be the next chapter in Policy Making. Understanding human behaviour and planning policies around that will prove to be an interesting challenge for Economists and Psychologists around the world. Successful policy implementation is an amalgamation of various streams from Pure Economics to Advertising and successful collaboration of all these streams will guide the world towards a better future.

Advertisements

2 thoughts on “Old Problems & New solutions.

  1. Pradeep Tiwari says:

    Highly informative article. The mentioned reason in the reference of sanitation, ’74 percent citing “pleasure, comfort and convenience” as the key reason for OD’ is not enough, as i have seen people deterring from using toilets because of issues like, ‘what will happen, if the toilet sink gets filled, they think its the life of toilet, which is going to get over if used daily. How to address such an issue?

    Like

    • econpoliticsblog says:

      Hey Pradeep thank you for taking the time to read the article and I am very glad u liked it. The main point that I want to highlight though this article was that many problems in India need a new approach to solving them. An approach that has its roots in behavioral studies.

      Now there are plenty of reasons why people don’t use toilets but what makes sanitation challenging is that the reasons change with the geography, meaning what’s true for villagers in Kerala might not be true for Punjab but the common thread that links all of this is lack of education.

      Education in any form has the power to influence an individual at a very young age, imbibing a value system that understands the problems associated with open defecation will go a long way in changing the difficulty we face while solving the sanitation problem.

      Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s