Can we be nudged to act on climate change?

Like many other countries in the world, the UK has committed to an ambitious path to net zero emissions, with the adoption of the sixth carbon budget suggesting a 63 per cent reduction in emissions by 2035.

The COVID-19 pandemic has clearly accelerated the decarbonisation process. A recent report from the UK Government's Climate Change Committee estimates that emissions fell by 13 per cent in 2020, with the largest fall in aviation (-60 per cent), followed by shipping (-24 per cent) and surface transport (-18 per cent).

Not surprisingly, home energy consumption and residential buildings show an increase in emissions of seven per cent. The report also estimates that 74 per cent of the fall in emissions is associated with the pandemic, with changes seen in the use of air, land, sea and travel, in conjunction with a reduction in fuel supply, manufacturing and construction.

Earth’s climate has constantly changed throughout history. Some of these changes can be attributed to natural processes, but most of them are due to human behaviour. With the end of restrictions because of the pandemic and a slow transition back to some sort of normal life, the question is whether these large falls in emissions will rebound and what can be done to avoid this.

Although awareness of the seriousness of the climate change problem is the highest it’s ever been, people don’t like changes in their own lives or in broader society. A recent survey by the EU's European Commission shows that more than three quarters of Europeans consider climate change a very serious problem. However, when asked, who within the EU is responsible for tackling the problem, only four in ten Europeans answered ‘me personally’.

More interestingly, the ‘environment and climate change’ is in fifth place of the main concerns at country level, after health, the economic situation, price rises/inflation and the cost of living, and unemployment. This indicates that when weighed against other priorities, like our job, family and comfortable lifestyle, climate change usually falls to the bottom.

Some basic lessons from behavioural economics and psychology can help explain why individuals are reluctant to do more to save our planet. In his 2015 book, Don’t Even Think About It, George Marshall - a former Greenpeace director who founded Climate Outreach Information Nework in 2004 - explains why our brains are wired to ignore climate change. Climate change is a multivalent phenomenon, meaning it is subject to different interpretations of causality, timing and impact. For this reason, it is extremely vulnerable to our tendency to select and adapt information to confirm our pre-existing assumptions.

If climate change can be interpreted in a variety of ways, then it is prone to be interpreted in the way we choose and the narratives we are keen to support. What is more, we actively contribute to these narratives, and develop our personal narratives.

In Marshall’s words “we do not accept climate change because we wish to avoid the anxiety it generates and the deep changes it requires”. But even with our cognitive limitations, we, as humans, have shown immense capacity for pro-social behaviour. Climate change is an additional phenomenon within our capacity for change. The main question is whether we are willing to accept that our own behaviour is its underlying cause.

More needs to be done to link the seemingly abstract concept of climate change to our daily life. Climate change is invisible to people’s eyes; it is slow-moving and its consequences are likely to be felt in the far distant future. |And yet the rapidly increasing examples of weather extremes seem to increase its salience. Not surprisingly, more than 300 papers in the science of climate attribution provide evidence that human activity is likely to increase weather extremes around the world, especially those related to heat.

In University of Chicago economist and Nobel Laureate Richard Thaler and Harvard Law School Professor Cass Sunstein's famous 2008 book Nudge: Improving Decisions About Health, Wealth, and Happiness, define a nudge as “any aspect of the choice architecture that alters people’s behaviour in a predictable way without forbidding any options or significantly changing their economic incentives. To count as a nudge, the intervention must be easy and cheap to avoid. Nudges are not mandates.”

People make most of their decisions instinctively rather than through rational thoughts. For this reason, they are prone to make mistakes. Often nudges are used to help us avoid making mistakes without us even knowing about it.

Nudge theory has strongly influenced the way we look at public policy and peoples’ behaviour. In the UK, examples of successful nudges are the opt-out scheme for organ donations to increase the number of organ donors, the reduced size of general waste bins to incentivise people to recycle, peer pressure to encourage people to pay their tax debt and swapping 17-hole saltshakers for five-hole ones in fish and chip shops to cut salt consumption. Little changes can make a big difference to people's behaviour.

Most of the biggest challenges we are facing in society involve human behaviour, and climate change is not an exception. Low-cost 'green' nudges won’t be able to solve the problem of climate change on their own, but they can certainly help by improving our choices and habits when it comes to the environment.

Scientists have published a number of studies on the effectiveness of nudge theory on people’s tendency to conform to social norms. Nudges have been used successfully in Cape Town to alleviate its water crises or to encourage people to conserve energy in the state of Minnesota. 

Reminding people to choose the environmentally-friendly choice via energy and water reports is widely used nowadays as a green nudge tool. This gives consumers information and feedback on how much they consume, how their consumption compares with that of other similar households and provides various hints and tips on how to improve. Energy and water reports commonly praise those who are already doing well. This can also trigger our intrinsic motivation to act more environmentally-friendly as we often like others to see us as good citizens.

Similarly, ambient energy orbs and eco-labelling may help in guiding households’ decisions towards more sustainable consumption. But more can be done here. People often struggle to understand the consequences of their actions on the environment. So even if they now receive better information and feedback on their energy and water consumption, they may not associate their behaviour to greenhouse gas emissions. Disclosing this information may be a strong motivator for people to change their behaviour.

Making the default options the environmentally-friendly ones can also make a difference. And making them easy to access and automatic can have a much bigger impact on people’s behaviour than asking for changes in their behaviour. For example, having letterbox lids as the default option for cardboard recycling bins, is likely to improve recycling of cardboard boxes and reduce dumping on the street.

Framing transition to a more sustainable world in a more positive way can also help increase people’s motivation to act in a more environmentally-friendly way. Clearly efforts to reduce greenhouse gas emissions need people to experience immediate losses now for something they might not even have the pleasure to experience in future.

A behavioural economist would suggest that people are loss averse, meaning that “losses loom larger than gains” of the same magnitude. For this reason, people are stuck to their status quo and may not like changes in their lifestyle. They might be reluctant to pay more 'green taxes' for electricity and gas bills, their travel and fuel.

Similarly, they may not like to spend more money on energy efficient domestic appliances, or electric vehicles. They won’t like the idea of flying less or switching to more plant-based food. But consumers neglect the economic benefits of changing their habits to more sustainable behaviours. Behavioural economics teaches us that information campaigns should be carefully designed to stress what we lose by not conforming to environmentally-friendly behaviour.

A nudge is not a mandate, but a simple way to influence our mental processes to change our behaviour through coaxing and positive assertion. Nudges can play an important role to help us build a more sustainable place to live. However, it is important to emphasise that this is only part of the suggested solutions to a global crisis where all parties should play their role.

If we want to be serious about climate change, we should all start to accept that our behaviour won’t be sustainable in the relatively short term.

Lory Barile is Associate Professor in the University of Warwick's Economics Department and Deputy Director of the Behavioural Environmental Economics Team (BEET). She teaches Behavioural Economics on the MSc Finance & Economics.

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