Nudging Environmental Behavior: How to Go Green

This article is an excerpt from the Shortform summary of "Nudge" by Richard H. Thaler and Cass R. Sunstein. Shortform has the world's best summaries of books you should be reading.

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What are the methods for nudging environmental behavior? Are there effective economic incentives for environmental protection?

Nudging environmental behavior is a strategy for encouraging people to make more environmentally friendly decisions. People are able to make their own choices, but the desired behaviors are incentivized in some way.

Read more about nudging environmental behavior.

Nudging Environmental Behavior

Our environment is under constant threat. 2019 was the second-hottest year on record, coming in close second—by a tenth of a degree Fahrenheit—to 2016. Pollution warms our planet, spoils our drinking water, destroys our soil, and harms our health. 

Despite admirable efforts on the part of the international community, global solutions to climate change have been hard to come by. One reason is that most governmental reforms intended to curb climate change are one-size-fits-all, top-down regulations—that is, efficiency standards or mandated reductions in carbon emissions that neglect the foremost principle of libertarian paternalism: choice. When people have no choice, or they lack the tools to satisfy the new rules, they either resist or simply fail.

The problem with free choice in the area of pollution, however—especially from the point of view of economists—is that it’s considered an “externality”: a harm that arises from and exists outside of the corrective forces of the market. For example, a natural gas company gets rewarded by consumers for the amount of energy it can produce, even if that production results in polluted air and global warming. In the short run, at least, the market doesn’t punish polluters, and so polluters have no incentive to curb their emissions.

By the same token, because environmental effects are minuscule at the level of the individual and mediated by industry—for example, when we turn up the A/C, we have no conception of the environmental cost of that choice—we don’t receive the proper feedback on our decisions to make a reasoned choice.

So, what’s the solution? Nudging environmental behavior in a way that can address these challenges. Economic incentives for environmental protection and other Nudge techniques would address the limitations discussed.

Nudging Environmental Behavior: How to Go Green

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  • Why subtle changes, like switching the order of two choices, can dramatically change your response
  • How to increase the organ donation rate by over 50% through one simple change
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