Applied behavioural science is facing some tough challenges, in the form of an ongoing replication crisis and a public debate on limits to nudging (including COVID-related stumbles). At the same time, we believe there is reason to be optimistic: the fusing of behavioural knowledge with data science methods means that we can see some of these shared challenges in a completely new light. In this article, we show how a transformation of our interactions with consumers and employees can usher in a new age for the field.
In many countries, most transactions are still made in cash. Yet, keeping cash in your wallet can be quite cumbersome. Notes are light and easy to carry, whereas coins are heavy and bulky. Does the inconvenience of carrying coins have an effect on how easily we spend them?
Our decision making is subject to more pervasive observation than ever due to technologies that companies use to understand our offline and online activities — even before we make a purchase. Our research finds that consumers are particularly averse to being observed while they construct their preferences. Consumers feel that their sense of autonomy is threatened and distort their behaviors significantly in order to evade being observed.
Languages influence perceptions and decision-making. We highlight one of the most important linguistic features – Future Time Reference. FTR impacts speakers’ behaviors involving intertemporal considerations, even the most critical decision on life – suicide.
Mutual funds cannot consistently return better-than-average performance. Yet investors often pick their mutual funds based on past performance. Researchers Leonardo Weiss-Cohen, Philip Newall and Peter Ayton conducted a long-term Think Forward Initiative research project that sought to answer how their investment decisions could be improved.
With most of its attention captured by the global fervor around 'big data', the banking industry has failed to give behavioral science the attention it deserves. I argue that, considering today’s challenges to fully take advantage of big data, implementing insights from behavioral science is a more cost-effective approach to improve customer experience in banking.
It is no secret that too few households save for a rainy day and this financial planning problem is a difficult habit to break. Would knowing your neighbours’ savings balance encourage you to save more?
It’s almost impossible to rationally plan old age, given that decisions in this domain are complex, jointly made and emotional. I argue that behavioral economics can help us understand some of our common decision-making barriers, such as dealing with decision avoidance, reframing old age positively, and designing interventions to better forecast our needs in old age.
Are VR technologies successful to increase savings? Or should we rely on more subtle simulation techniques? And does it matter whether people imagine positive or negative life events?
Most people are overconfident in various aspect of their daily life. Yet, this bias has been shown to have detrimental economic and financial consequences. In light of these costs, why is this bias so persistent in the population? Our research provides an explanation for this phenomenon: being overconfident can provide a strategic advantage by influencing others in social interactions.