4. Episode: Behavioral Insights into Law with David Tannenbaum
In this episode Nina and Henna talk about nudging and its possibilities and pitfalls in legal design with David Tannenbaum, an Assistant Professor in the Department of Management at the University of Utah’s Eccles School of Business.
Where law seeks to influence human behavior by setting obligations, legal design aims to make those obligations easier to understand and follow by using human centric design methods. Sometimes these methods can encompass behaviorally informed “nudges”. In behavioral economics nudges are defined as any kind of interventions in the physical or social environment that alters people’s behavior in a predictable way without forbidding any options or significantly changing their economic incentives. So to say, nudges make certain decisions easier, yet without limiting one’s freedom of choice. To put it simply, nudging means guiding people to make better choices by modifying the environment and choice architecture. A fitness app nudges with activity notifications, so does a car navigator showing the best route options.
Nudging, however, also has a reputation of being a psychological trick used in product marketing: those chocolate bars placed next to a cash register at your grocery store aren’t there just by random. But should legal products such as contracts and court documents use nudging too? Or do they nudge already?
Nudging just might be one of the misunderstood concepts and rarely used intentionally in the legal world. Years ago, when Henna wanted to attend a conference about nudging, her manager at that time thought it was a self help course about managing one’s own personal life that had nothing to do with law and didn’t let her attend the event. However, after Richard Thaler and Cass Sunstein published their book Nudge: Improving Decisions about Health, Wealth and Happiness in 2008 nudging has gained public awareness and has also become a popular alternative to traditional regulation in various governments and administrations around the world, especially in angosaxon jurisdictions.
Despite the controversial reputation nudging may have, it is good to remember that our environment influences us anyway. As our guest David reminds, “every day, all the time, everywhere you go, there’s nudging going on”. Nudging is not a legal concept, but as lawyers and legal designers still influence the decisions of their clients and peers, it is better to be aware of the power of nudge and learn to use it ethically and wisely.
David Tannenbaum is an assistant professor in the department of management at the University of Utah’s Eccles School of Business. His research focuses on decision making under uncertainty, and its applications to public policy. Link to David Tannenbaum’s website: https://davetannenbaum.github.io