Nudging consumers toward sustainable consumption

1. Nudging consumers toward sustainable consumption Kristiina Aalto Eva Heiskanen National Consumer Research Centre

2. Agenda • Framework: • Nudge as an approach to shape sustainable consumption • Data and methods: • EUPOPP project and cases Sustainable Public Catering and Energy and Environmental Expert (not originally Nudge) • Findings and discussion • Potential and problems of Nudge?

3. Framework • Consumption and the demand-side are important for reaching a sustainable economy • potential for factor-4 improvements simply by changing demand/usage practices • Consumption and demand-side are difficult to influence • the sovereign consumer • the unmanageable consumer • routine and unreflective consumption

4. Nudge (Thaler & Sunstein) • Many consumer decisions are made automatically and are subject to various biases • libertarian paternalism: need to nudge people into the right direction (their own rational preferences) • Consumer choices can be improved by better “choice architecture” • i.e., by reorganizing the way choices are presented to the consumer • Examples: • fruit instead of cake in the ”impulse basket” near the cafeteria cashier • display average electricity consumption of other households, smiley for those who use less than average

5. Data: Cases from the EUPOPP project • EUPOPP: Policies to promote sustainable consumption (http://www.eupopp.net) • Focus on analysing the impacts of SC policy strategies and instruments on consumption patterns • 40 short case studies and 10 detailed ones of different kinds of policy instruments in Europe • Two Finnish cases: • Sustainable Public Catering • Energy and Environmental Expert • Interviews with stakeholders, consumer focus groups

6. Sustainable Public Catering • Biases: familiarity, routine eating patterns • Solution: weekly vegetarian day in public canteens (as one option to meet Council of State DoP on sustainable public procurement) -> direct experience of veg food may nudge people to use it more • Results: • slow implementation • Helsinki school lunches: weekly veg day as of 2011 • public debate but also appreciation ”makes life easier”

7. Energy & Environmental Expert • Biases: Invisibility of energy use, poor communication between energy users and ’real’ experts • Solution: Peer volunteers monitor energy use, analyse causes, give advice -> energy & environment socially visible in/near home • Results: • Variable, good savings (5%) in best houses • Some cases of extremism/busybodyism among EEEs, e.g. ”saunas not in use this weekend”

8. Pros and cons of Nudge • Shaping choice arhitectures can be effective • but requires significant resources to ’tailor’ design everyday contexts • Shaping choice architectures is fairly legitimate in some situations • e.g. tradition of steering due to public health benefits • communications and public engagement still necessary & helpful • nudge can work once the goal is widely shared, means well justified and legitimate • Paternalism vs. busybodyism? • who is the choice architect? • manipulation vs. help in meeting own goals?

9. Conclusions • Nudge strategies are not totally new • often used in social marketing etc., but often not consciously or systematically • Works where choices are not made very consciously • routine and ’autopilot’ types of everyday practices not amenable to cognitive interventions • Nudge as an explicit policy instrument is between regulation and information • more intrusive than information provision so requires more legitimation • Choice architects need to be selected carefully when used in public policy • transparency, alignment of public vs. personal goals…

10. Thanks!All comments welcome! eva.heiskanen@ncrc.fi