What’s for lunch? Behavioral economics meets climate change

Marc Gunther Marc Gunther discusses the importance of changing behavior when developing climate solutions. Without behavior change, climate solutions will be almost impossible. And the opportunities/ technologies exist that will get us towards solutions, but people aren't taking advantage of them.  It's clear that any environmental public engagement campaign needs to take human behavior and methods of shifting human behavior, into account.

Posted Nov. 16, 2009
By Marc Gunther

At the Net Impact conference last week, a waiter stopped by before
lunch to ask if anyone at our table wanted a vegetarian meal instead of
chicken. Just one or two people did.

This, as it happens, is typical. When a meat-based entrée is being
served, and people are offered a vegetarian alternative, about 5 to 10%
will request it.

But what if the choices were reversed? Organizers of the 2009 Behavior, Energy and Climate Change Conference,
which began today in Washington, tried an experiment: They made a
vegetarian lunch the default option, and gave meat eaters the choice of
opting out.

Some 80% went for the veggies, not because there were lots of
vegetarians in the crowd of about 700 people but because the choice was
framed differently. We know that because, at a prior BECC conference,
when meat was the default option, attendees chose the meat by an 83% to
17% margin.

More than lunch is at stake here. “Omnivores contribute seven times
the greenhouse gas emissions, when compared to vegans,” says Karen
Ehrhardt-Martinez, the conference chair, who works for the American
Council for an Energy Efficient Economy.

Might there be broad-based ways to promote a vegetarian diet, while
giving people the freedom to choose what they want? How can smart-grid
technology be designed to encourage people to conserve energy? Which
“green” marketing messages work, and which don’t? Can the insights of behavioral economics help fight climate change?

Those are the questions that engaged the policy makers, academics,
and business executives at this BECC event, which differs from most
conversations about climate change. Typically,
when politicians, environmentalists or corporate executives  discuss
the issue, they focus on technology (solar, wind, electric cars) or
regulation (cap-and-trade, the UN climate talks). The BECC crowd
focuses on another powerful lever, albeit one that doesn’t get as much
attention: human behavior, and in particular the
irrational, emotional, self-defeating, short-term, inconsiderate and
plain old silly human behavior that most of us engage in every day.

Like keeping  incandescent light bulbs burning, when we know  CFLs
are cheaper (and most work very well). Or looking at  the price tag of
an appliance, rather than its lifecycle costs. Or buying things–like over-sized homes–that we can’t afford.

As Erhardt-Martinez notes, personal choices have a huge collective
impact on the climate crisis. Home energy use and the use of personal
vehicles—that is, the way we live—accounts for about 38% of U.S. energy
consumption. Behavior change could generate energy savings of 25 to 30%
over the next five to eight years, she said.

There’s no need to wait for technology breakthroughs. “We already
have much better choices,” she said. “People aren’t making them.”

Dan Ariely, professor of behaviorial economics at Duke and director of the Center for Advanced Hindsight (!)
— gave the opening keynote at BECC, and he left no doubt that most of
us are not nearly as rational in our decision-making as we would like
to think we are. (I blogged in June about Ariely’s entertaining book, Predictably Irrational: The Hidden Forces that Shape Our Decisions. If this topic interests you, I can also enthusiastically recommend Nudge: Improving Decisions about Health, Wealth and Happiness by Richard  Thaler and Cass Sunstein. Sunstein has since joined the Obama administration as a shaper of regulations.)
Ariely, Sunstein, Thaler and others have all brought the insights of
psychology to the study of economics, helping explain how we humans
actually behave> Hint: we’re not always the dispassionate, rational,
self-interested, utility-maximizers of Econ 101.

“We wake up every morning with an incredible sense of agency,”
Ariely says, meaning that we see ourselves as masters of our own fate.
But evidence suggests that emotion, not to mention the people who
design user interfaces—from the lunch menu to the choices presented by
our 401-K plans—play a large role in our lives.

The climate crisis is a particular challenge for behavioral
economists. It’s a long-term problem, and we tend to focus on the
immediate. (That’s why Americans can’t resist dessert, and had a negative savings rate for
many years.) Greenhouse gases are invisible, unlike other pollutants.
Measuring the impact of individual actions is all but impossible.
Global warming will harm other people, mostly poor people in the global
south, before it damages the U.S.

“If you said, I want to create a problem that people don’t care
about, you would probably come up with global warming,” Ariely says.

Still, there’s creative work being done to change behavior. Check out the Energy Smackdown, a community-based competition to excite people about saving energy. Some utility companies put smiley faces on bills of efficient consumers,
promoting friendly neighborhood rivalries. Speakers at the conference
addressed such topics as “Consumption-Based Carbon Footprint Accounting
Tools,” “Pay as You Drive Insurance” and “Framing Matters: The Impact
of Policy Context on Willingness to Change Energy Consumption Behavior.”

Call me a geek, but I’d like to know more. Unfortunately, I couldn’t
attend most of the conference. So if you presented, or want to offer
insights on how behaviorial economics can mitigate climate change, feel
free to comment below, send me an email or propose a guest blogpost on
the topic.

No comments yet... Be the first to leave a reply!

Leave a Reply