Applying Behavioural Insights to

Public Policy Simon Ruda

1. What are behavioural insights?

2. Who are the Behavioural Insights Team?

3. How can we apply behavioural insights to

public policy?

Outline

What are Behavioural Insights?

Behavioural Insights

Psychology

Ethnography

(Behavioural) Economics

Public Policy

Understanding how people behave in practice so

that we can design policy better

The suspect game

Suspect 1

Suspect 2

Suspect 3

The suspect game

Some random people

Can you see a suspect?

0

5

10

15

20

25

30

Simultaneous + Warning + Suspect Sequential + Warning + Suspect

% False Identifications without suspect in line-up

Stebley et al. 2001

Danziger et al. 2010

Contextual factors affect professional decision

making

Contextual factors affect the biggest life

decisions

0

1000

2000

3000

4000

5000

6000

1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 1975 1976

Ann

ua

l suic

ide

s

Year

Clarke et al. 1988

“It turns out that the environmental effects on

behavior are a lot stronger than most people

expect”

Daniel Kahneman

We need to think differently about behaviour

“Our government will find intelligent ways to

encourage, support and enable people to

make better choices for themselves.”

The Behavioural Insights Team

We work across the full spectrum of

Government policy

Crime Immigration Justice

Health

Education

Social

inequality Energy

Labour market Tax

UNCLASSIFIED 21

“David Cameron’s Vanity Project”

Everyone hated us

Press coverage

Current policy Behavioural Insights policy

Australia

Singapore

Peru (World Bank)

USA Israel

UK

Moldova (UNDP)

Ukraine (UNDP)

Belarus (UNDP)

Montenegro (UNDP) Guatemala

(World Bank)

Canada

Oman

UAE

Germany

Finland Netherlands

Pakistan (DfID)

India

Mexico

Jamaica (UNDP)

Brazil (World Bank)

Ethiopia (DfID)

Tax

Traditional policy levers

Regulation

Incentives

Information

Behavioural

Insights

Criminal sanctions

Financial penalties

HMRC adverts

Nine out of ten people pay their tax on

time

Social norms to increase tax payment rates

within 23 days (1 month)

33,6% 35,1% 35,9% 37,2% 39,0%

Control (8,558) UK Norm (8,300)

Local Norm (8,403)

Debt Norm (8,779)

Local + Debt Norm (8,643)

Our UK tax

trials brought

forward an

extra

$320million in

12 months at

zero marginal

cost.

Nine out of ten people pay their tax on time.

1.6% 1.5%

12.1%

19.1%

Public gain (16,807) Public loss (17,159)

Loss-frame

People with large debts react differently Different groups respond to different

messages

Owe $50,000+

Behavioural Insights Team in Latin

America

• In Guatemala, tax revenue as a proportion of GDP is one of the

lowest in the world

Country 2012 Tax revenue (% of

GDP)

Guatemala 12%

Nicaragua 18%

Latin America 26%

World Average 32%

BIT and the World Bank: Tax Compliance

in Latin America

43%

increase

3,9% 4,3% 4,4%

5,0% 5,4% 5,6%

Control Original SAT Letter

Behavioural Letter

Behavioural + National Pride

Behavioural + Deliberate

Choice

Behavioural + Social Norms

Percentage of taxpayers that paid tax by letter received

Amount of tax received for each letter sent

$6,67 $6,82

$14,19 $16,16

$20,64

$24,62

Control Original BIT letter BIT + National Pride BIT + Social Norms BIT + Deliberate Choice

Percentage of taxpayers who went on to make a

payment the following year (with no further reminder)

4,3% 4,3% 4,3% 4,5% 5,0% 5,0%

Control Original SAT Letter Behavioural Letter Behavioural + National Pride

Behavioural + Social Norms

Behavioural + Deliberate Choice

Giving

money to

charity

Increasing payroll giving inside government

The image of a colleague more than doubled

the number of people who signed up

2,9%

6,4%

Control Group Image

Proportion giving away a day’s salary to

charity

5% 7%

11% 12%

17%

Control Group Celebrity Sweets Personal email Sweets + Personal

Getting people back

to work

‘Implementation intentions’ – helping people

plan their actions

Proportion of people leaving social security

benefits

51% 56%

Control Treatment

After 39 weeks…

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

0 13 26 39

Weeks Since Pilot Start

Em

plo

ym

en

t R

ate

Treatment Group Control Group

Increasing

diversity of

the police

force

Treatment message

The “affirmation boost”:

“Before you start the test, I’d like you to take some

time to think about why you want to be a police

constable. For example, what is it about being a

police constable that means the most to you and

your community?”

Reflecting societal diversity in Police recruits

111,9

105,9

112,1 110,5

Non-BME BME

Average test score

Control

Treatment

Re-shaping

consumer markets

Re-shaping markets

Re-shaping markets

1. Scan your bill 2. Switch & save

www.behaviouralinsights.co.uk