The real world of policymaking

Some of the most significant uses of behavioral science involve fuel economy and energy efficiency mandates. To be sure, these mandates reduce the externalities that come from emissions of greenhouse gas and other air pollutants. But the overwhelming majority of their benefits involve internalities (in the form of consumer savings). Consumers can, of course, buy fuel-efficient vehicles and energy-efficient appliances if they like. For the consumer savings to count as part of the justification of the relevant regulations, public officials have had to argue, and have explicitly argued, that consumers are making mistakes – that some combination of present bias, myopic loss aversion, limited attention, and imperfect math skills lead them to purchase the wrong vehicles and appliances. Without the relevant behavioral findings, on which public officials have heavily relied, current fuel economy and energy efficiency mandates would fail cost–benefit analysis and would be exceedingly hard to justify.

Behavioral science has helped to underpin and spur numerous other regulatory mandates, including occupational safety regulations, food safety regulations, investor protections, tobacco regulations, and even the Federal Trade Commission's proposed ban on noncompete clauses. Other significant uses of behavioral economics involve taxes, default rules, and disclosure requirements. Cigarette taxes and taxes on sugar-sweetened beverages have been justified by reference to present bias. Drawing on behavioral findings about inertia, policymakers have automatically enrolled over 10 million poor children in free school meals programs. In the United States, the greenhouse-gas inventory, imposed on polluters, was directly spurred by behavioral science, and it has significantly reduced greenhouse-gas emissions.

Because behavioral scientists in or near the world of actual policymaking have been spending most of their time on system change, it is fair to wonder it is necessary to advise them to do so. It is a little like suggesting that professors of English literature should pay more attention to William Shakespeare.

C&L are unenthusiastic about nudges that target individuals, but their account is a lawyer's brief; the actual evidence does not support their negative conclusions. In any case, targets and tools can be combined in diverse ways. As the greenhouse-gas inventory example suggests, companies might be nudged by requiring forms of disclosure, and the result might be system-wide change. Of course mandates can be imposed on individuals; consider mandatory seat-belt usage, which has a plausible behavioral justification, as do restrictions on smoking.

The nonexistent crowd-out effect

C&L are worried about crowd-out. They argue that because of behavioral scientists' excessive enthusisasm for what they describe as i-frame interventions, system reform has become less likely. But if we were making a list of 100 reasons why system reform has not happened in some important area (such as climate change), the fact that some behavioral scientists have been enthusiastic about i-frame interventions could not possibly make the list.

Having worked in the US government for many years (and with numerous other governments less formally), on scores of legislative proposals and well over 2,000 regulations, I am unaware of any case in which i-frame interventions operated to deter or stop s-frame interventions. To be sure, there might be some such cases, but if anything, it would be more plausible to suggest that causation runs in the opposite direction: i-frame intervention alert policymakers (and others) to the existence of a problem, which spurs support for s-frame interventions.

Lacking evidence on behalf of their claim, C&L point to unreliable non-evidence, including surveys finding that if you tell people about an i-frame intervention, you can reduce support for an s-frame intervention. Nothing follows from those surveys. They do not show that the crowd-out effect is real or important – that in the actual world of policymaking (involving legislation or regulation, each of which has its own exceedingly complex processes and dynamics), fuel economy labels reduce support for fuel economy mandates, or graphic warnings on cigarette packages reduce support for cigarette taxes or bans on smoking in public places.

C&L offer a set of arresting stories about corporate campaigns, in which companies have drawn attention to the importance of personal responsibility. But what lessons can be drawn from such stories? BP's interest in carbon footprints may or may not be laudable, but can anyone argue that it is the reason that the United States or the United Kingdom has not enacted carbon taxes, or what C&L want, which is morel extensive regulation? Does anyone think that if behavioral scientists had not supported antilittering campaigns, we would see more and stronger efforts to reduce plastic waste? Did recent legislation in the United States (the Inflation Reduction Act), in large part designed to reduce the risks of climate change, get enacted because behavioral scientists suddenly decided to retreat, or not to study individual behavior?

C&L offer a conspiracy theory. In their view, policy problems are easy, because good s-frame solutions are available. The obstacles, they think, are “the active and coordinated efforts to block s-frame reforms by concentrated commercial interests who benefit from the status quo” (target article, sect. 3, para. 3). In their account, the main problem lies in the machinations of “powerful groups” who maintain their power partly by “promoting the perspective that these problems are solvable by, and the responsibility of, individuals” (target article, sect. 3, para. 3). Those powerful groups have enlisted behavioral scientists, who turn out to be pawns or dupes, unwittingly contributing to the failure to implement the obvious solutions.

Powerful groups often resist desirable change, but C&L neglect two challenges: Tradeoffs and reasonable disagreement. There are no simple solutions to the problems posed by climate change, obesity, retirement policy, healthcare, privacy, and plastic waste. The good news is that behavioral science can make, and is making, significant dents in each of those problems. Incidentally, one of the ways that it can do that is by targeting individual behavior, with the laudable goal of improving people's lives. Behavioral scientists who seek to understand that behavior and to improve such targeting ought to be applauded, not scolded. As some government officials say: Better is good.