L’application de la perspective comportementale dans les États-Membres de l'UE et à la Commission Européenne

24 April 2019Brussels

Joana Sousa LourençoForesight, Modelling, Behavioural Insights and Design for Policy Unit

Joint Research Centre

Joint Research Centre

A collaborative and experimental space applying FORESIGHT, MODELLING,

BEHAVIOURAL INSIGHTS

and DESIGN THINKINGto explore, connect and find solutions

for better policy-making.

Clarifying some of the behavioural terminology

Behavioural Economics

≠

Behavioural Insights

≠

Nudging Behavioural

insights

Behavioural economics

PsychologyOther

behavioural sciences

Clarifying some of the behavioural terminology

Behavioural Economics

is NOT

the study of people being irrational

2017Proposal for a Regulation on E-Privacy

20022008

20102011

20132014

2015

2009Proposal to ban pre-checked boxes in online contracts

2010Review of the PRIPS legislation (Packaged Retail Investments Services)

2016The EC publishes BIAP 2016

2014Recommendation on online gambling

Revision of the Tobacco Products Directive

2011DG ENER first behavioural study testing consumers' understanding and use of energylabels.

2017

Academic and institutional context

05/2019Launch of JRC's Competence Centre on Behavioural Insights

2018Paper Nature Human Behaviour

2018

Behavioural insights applied to policy

Incentives

Regulation

Information

Public

policy

Citizens'

behaviour

Assumptions

Observed evidence

BIs have a complementary role

Applying a more nuanced and evidence-based understanding of human behaviour

Acknowledging the existence of biases and heuristics in our thinking

To give account of the use of behavioural insights (BIs) in policy:

• Policy initiatives

• Institutional developments

Methodology:

• Survey: 900 policy-makers, researchers, NGOs and businesses contacted. 300 replies analysed and followed-up.

• Desk research

↓

+200 Behavioural policy initiatives

Not just a report…

BIAP 2016

Geographical scope: EU + EFTA

https://ec.europa.eu/jrc/en/research/crosscutting-activities/behavioural-insights/europe

32 European countries at national, regional and local level

Taxonomy of behavioural policies

Behaviourally-tested initiatives: Initiatives being explicitly tested, or scaled out after an initial ad-hoc

experiment.

Behaviourally-informed initiatives: Initiatives designed explicitly on previously existing behavioural evidence.

Behaviourally-aligned initiatives: These are initiatives that, at least a posteriori, are implicitly aligned with

behavioural evidence.

BIs ARE reshaping policy in a NUMBER OF FIELDS

Consumer protection Understanding decision-making in consumer contracts

Taxation Using behaviourally-informed letters to enhance tax compliance

Employment Using commitment devices to aid job seekers

Health Reducing errors in medical prescriptions

Energy Promote energy saving behaviour in office buildings

Competitiveness Supporting small businesses through Growth Vouchers

Justice Improving perceived procedural fairness

Welfare Raising enrolment in pension schemes

Environment Promoting waste sorting and reduction

Transport Improving road safety

Reducing motoring offences by leveraging loss aversion

(Irish Road Safety Authority, 2015)

Ban of pre-checked boxes

− Ban of pre-checked boxes: Article 22 of the Consumer Rights Directive (2011)

37%

80%

94%

74%

90%86% 86%

0%

20%

40%

60%

80%

100%

Before AE

(All)

Low

income

(<$20K)

High

Income

(>$80K)

Young

(<20)

Older

(50-59)

Male Female

Before Automatic Enrollment

After Automatic Enrollment

Another example: Savings Plan Participation and Automatic Enrollment (Madrian, 2001)

Behaviourally-informed policy enforcement

Enforcement action driven by the concern that airline payment surcharges were a 'drip-fee' or 'price partitioning' device which concealed the true or genuine price of their services, and made it difficult for consumers to compare prices easily

Reducing energy consumptionwith comparable home energy use reports

(Encerticus, 2014)

Documented effect in Minnesota: -2%

Increasing tax compliance of small accounting companies

RCT in cooperation with the

Slovenian tax authorities

Encouraging consumers to use Alternative Dispute Resolution (ADR) procedures

RCT: Can behaviourally-informed complaint forms reduce the number of disputes resolved with litigation

relative to standard forms?

0

10

20

30

40

BI form Standard form

% c

ase

s r

eso

lve

dw

ith

lit

iga

tio

n

Price transparency and consumer's choice for energy providers

PRICE lab & Ireland's Commission for Energy Regulation (2016-8)

Evidence that the EAB is likely to result in consumers placing greater weight on the unit price, leading to them being more likely to choose cheaper packages

Pretesting of an intervention:Mandatory “Estimated Annual Bill” (EAB)

Institutional developments

High Good Sufficient Low

2016!

A number of institutional models exist. Criteria to classify them:

Since BIAP 2016, a number of developments….

BI World Map (OECD, 2018): 200+ institutions

World Bank, 2018

Australia

Canada

Denmark

France

Germany

Netherlands

Peru

Singapore

UK

USA

Behavioural insights throughout the EU policy cycle

What are we doing to promote a behavioural approach?

1. Knowledge exchange and/or cooperation with Member States

2. Scientific support to policy DGs

Scientific advice, including methodological support to the behavioural studies that the EC runs through contractors.

3. In-house behavioural research

4. Capacity building

2-days training for Commission staff & Gov't Consumer Policy representatives

1. We work with national authorities who have behavioural capacity

First we mapped activities, now we are running joint field trials

Trial jointly w/ SPF Finances (BE) and Revenue (IE)

2. We support to European Commission services who want to apply a behavioural approach

Over 20 large-scale studies in the past 5 years

From on-line gambling to energy labelling to vulnerable consumers…

https://ec.europa.eu/info/policies/consumers/consumer-protection/evidence-based-consumer-policy/behavioural-research_en

Behaviourally-tested policy intervention informing an Impact Assessment

EC energy labelling study:

− Alphabetic scales better than numeric scales

− Labels with an 'A to G' scale better than 'A+++ to D' scales.

− Label design more important when energy efficiency is not of key importance to consumers.

↓

Used in the Impact Assessment for the Regulation on Energy Efficiency Labelling (2015)

Framing and Simplification

Behaviourally-tested intervention informing an EC Recommendation on Online Gambling (2014)

EC Online gambling study:

− For 'in-gamble treatments', fixed monetary limits and alerts work

− Interrupting, altering or disturbing 'human-machine' interaction has a positive effect

↓

Evidence informed EC Recommendation on Online Gambling (2014)

Pre-commitment strategies

3. We do in-house research ourselves - Examples

Anticipating policy needs & responding to specific requests by EC colleagues

Agriculture: Adopt sustainable farming practices by farmers

Support Impact Assessment on Modernisation and Simplification of the Common Agricultural Policy (CAP)

Nutrition: Front-of-package (FOP) labelling

Contributing to a study for DG SANTE by examining the available evidence on FOP from a behavioural perspective

Financial: Encouraging switching of financial products

Support Impact Assessment on Payments Account and Mortgages Directives

Social biking (S-b): Encouraging EU citizens to move more and use more environmentally sustainable transport.

W/ 26 European cities

4. We offer training in behavioural economics

2-days training for Commission staff & Gov't Consumer Policy representatives, aimed at policy officers interested in applying behavioural thinking into the development of their policies

In a nutshell...

✓ The behavioural approach has been growing in popularity at the EU and this trend is likely to continue

✓ It complements – rather than replaces – more traditional tools (e.g. incentives, regulation or information disclosure)

✓ The behavioural approach is about contributing to better policies – not only nudging

Thank you