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What can behavioral economics contribute to tackle the threat of climate change?

Virtual Launch Event for the 2020 Behavioral Economics Guide
Posted on October 01, 2020

On September 24, we teamed up with our friends at BehavioralEconomics.com and our panel of experts, to celebrate the launch of the Behavioral Economics Guide 2020, which this year focused on 'What can behavioral economics contribute to tackle the threat of climate change?'

Speaking on the day were:-

Mark Cliffe - Introduction (ING New Horizons Hub)

Ian Bright - Moderator (ING New Horizons Hub)

Elke Weber (Princeton)

Paula Papp (Frontier Economics)

Helena Rubinstein (Innovia Technology)

Henry Stott (Decision Technology)

Aline Holzwarth (Center for Advanced Hindsight)

If you didn't manage to catch the event when it happened, you can watch it in full via the TFI YouTube link below.

Or if you just want a quick overview, our friends at ING Think kindly sent journalist Jeremy Gaunt to cover the event, and we've shared a few highlights of his article below.

“People tend to take the easy route to something and make it habit; looking ahead at negative consequences -- to the environment, for example -- is abstract and requires sustained attention.”

Academics and practitioners taking part in a 24 September webinar – "What can behavioural economics contribute to tackle the threat of climate change?" -- clearly believe that it can, although it will not be easy to reverse the way humans act when it comes to the environment.

Studying the hows and whys of peoples' decision-making, they said, may provide companies, banks, governments and activists with a roadmap to a cleaner and sustainable planet.

Perhaps it is a matter of "framing" things to emphasise the positives over the negatives. Or perhaps it is closing the gap between what people say they do and what they actually do. Yet again, simply finding out what people are willing to pay for greener products could help.

Participants painted a fascinating picture of human conduct and how it can impact the fight for a greener planet. People tend to take the easy route to something and make it habit; looking ahead at negative consequences -- to the environment, for example -- is abstract and requires sustained attention.

Elke Weber, a psychology and public affairs professor at Princeton University, said that this abstraction meant that many people and businesses tend to prefer the status quo to an upfront cost to fix something they cannot see in the future.

They call this "conservative," she said, "(but) in the climate domain... business as usual is probably the least-safe option".

Both Weber and Aline Holzwarth, head of behavioural science at digital platform Pattern Health, cited multiple research that showed people respond better to positive concepts.

If you want to get people to pay a carbon tax, try calling it a carbon offset or dividend, for example. This would work in the same way that selling beef as 75% lean is easier than selling the identical thing as 25% fat.

"Negative gets attention, but it is very bad at keeping attention”, Weber said.

You can read the report in full, here - https://think.ing.com/articles...

Used with permission from ING Think.