Environmental Regulation through Nudges

Abstract

Since the 2000s, public policymakers have taken an interest in a new form of regulation stemming from research in psychology and experimental economics: nudges. This chapter provides an introduction to the type of incentives and discusses their effectiveness in the context of environmental regulation, even though the use of nudges can be imagined in many behavioral spheres. It discusses the ethics of nudges; some of these can be based on the exploitation of cognitive biases, such as default options, which tend to exploit the bias toward the status quo. The chapter illustrates the consequences of cognitive biases for environmental decision-making using some examples. When a regulator implements a nudge that takes the form of a piece of information communicated to agents about the proper behavior to adopt, the goal is to induce a change in behavior in the individual concerned, so that they will, for example, be more responsible regarding the environment.

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