When I was studying economics in the 1980s, it was quite vulnerable to the criticism that the entire edifice was built on a shaky assumption: homo economicus. But now that Kahnemann, Thaler et al. have slain h.e., economics is that much stronger.
Behavioral economics is becoming a major component of LIRNEasia’s toolkit. The discussion below refers to the decision architectures that appear to keep the money flowing into Google. But most people, of course, never make that single click. Defaults win. The role of defaults in steering decisions is by no means confined to the online world.
I co-taught an experimental graduate seminar with one of my colleagues at Ohio State University in the early nineties where we explored what policy could learn from research on how people actually behaved, thought and decided. I taught the first half of the seminar by deconstructing various policy and regulatory debates (dominated by lawyers and economists) to lay bare the fundamental (and unexamined) assumptions regarding human behavior. She taught the second half, talking about how behavioral research could challenge or confirm those assumptions. This then led to multiple funded projects and dissertations that she directed on policy-relevant social science research. It was possibly because of this “priming” (a key concept in contemporary behavioral research) that I was unquestioningly amenable to the suggestion to study how poor people actually used ICTs that came from the research planning sessions we conducted as part of the launch of LIRNEasia in September 2004.
LIRNEasia in partnership with Lanka Software Foundation and several other partners has spent a lot of time figuring out how we could catalyze the growth of useful apps on mobiles, in connection with a project proposal we just submitted. Unlocking the wealth of data sitting inside government, as described in this op-ed by Richard Thaler is a great way to go. The US is doing it. Can we get our governments also to follow? Not surprisingly, San Francisco, with its proximity to Silicon Valley, has been a pioneer in these efforts.