Nick Denys

14th Jul 2011

On Monday Richard Thaler, author of Nudge and No10 advisor on behavioural economics, gave a talk at Policy Exchange. Much of what Thaler said  could be classed as being basic common sense. If you want people to do something, make it easy for them to do it. Any action that the government takes should be clearly explained. Public permission is key to success. It is better if action emanates and happens voluntary from the group where a solution is desired.

One of the challenges for behavioural economic theory is to get policy makers to understand that great effort is needed to be subtly effective.  It is wrong to assume that a government that devolves decision making responsibility down to the local level will necessarily be run by a  microscopic civil service, that less effort is needed to make less rules and regulations.  Facilitating “power to the people” should be as time-consuming as the traditional top-down approach  to policy making, except the effort will happen at a different stage of the process.

 After I left University I trained to be a community mediator in North London. The most important message that was communicated to us was that people are a lot more likely to keep decisions they come to themselves rather than ideas suggested by others. It did not matter if we could see what the solution was within five minutes of entering a situation.  No good would come from pointing out what we perceived to be obvious. All the participants may have agreed with the observation but any agreement would not have lasted longer than it would have taken to get home. You had to spend hours asking questions to help both sides come to a joint way forward. Any shortcut just meant more work later on.

The current way of governing often involves coming up with a ‘solution’ quickly and then putting in a great deal of effort to shoehorn said ‘solution’ into the real world. The new way of governing shold be about putting in a great deal of effort into facilitating real world solutions, whatever these solutions may be.