16 Apr 2009: Analysis

Using Peer Pressure as a Tool
to Promote Greener Choices

Environmentalists, utilities, and green businesses are turning to behavioral economics to find innovative ways of influencing people to do the right thing when it comes to the environment. Is this approach really good for the planet or just a fad?

by richard conniff

Let’s say that every time you ride public transit, your fare card with its unique number also buys you a ticket to a periodic $50,000 lottery. Your number can turn up any day of the week, but you only win if you rode public transit that day. Think you might start taking public transit more often?

It’s an idea straight out of behavioral economics, an unconventional field of research that examines how human nature really works and uses it to shape the choices people make. The lottery idea, for instance, capitalizes on the human tendency to overvalue outcomes with extremely low probabilities, according to George Loewenstein, a behavioral economist at Carnegie Mellon University. The possibility of finding out that you missed the big payoff also exploits our innate regret aversion.

This new way of thinking about — and some would say manipulating — behavior is likely to be an important tool for addressing environmental issues over the next few years. Behavioral economics is the theory behind a variety of measures now being promoted by environmental groups, power companies, and green businesses — from smart meters for cutting electricity consumption to the use of social networks to promote weatherization.

The Obama White House is packed with true believers in behavioral economics, including economic advisor Austan Goolsbee, budget director Peter Orszag, and regulatory czar Cass Sunstein, a constitutional scholar
This new way of thinking about — and some would say manipulating — behavior is likely to be a key tool for addressing environmental issues.
and co-author of Nudge, a popular treatment of subtle ways to influence the choices people make. And while the Obama administration has yet to unveil environmental initiatives based on behavioral economics, Orzag recently told Time magazine, “It really applies to all the big areas where we need change."

For those who skipped Economics 101 — or took it before behavioral approaches began to coalesce into a theory in the 1980s — a primer is in order: Traditional economics holds that people act rationally. We sort through all available information, balance the pros and cons, and arrive at the best possible decision to maximize our own self-interest.

Behavioral economists say that we are quirkier and more complicated than that. Instead of carefully weighing the choices, we often make decisions based on gut instinct. Or we get overwhelmed and do nothing. We also do irrational things like acting altruistically toward total strangers. Unless you happen to be an economist, this may not come as news. Some psychologists carp that the economists are just putting a new spin on basic social psychology. But by any name, taking account of normal human tendencies promises a more realistic way of predicting and influencing how people act.

For instance, in one study, researchers asked each of four groups of utility customers to cut energy consumption for a different reason — the good of the planet, the well-being of future generations, the financial
‘People don’t just want to conserve energy,’ one psychologist says, ‘they want to be acknowledged for conserving energy.’
savings, or because their neighbors were doing it. By comparing electric meter readings, the researchers determined that only the last message had any effect, eliciting a 10 percent drop in consumption. A subsequent study found that when electric bills compared a customer’s energy consumption against the neighborhood average, profligate customers scaled back. In fact, the social norm was so powerful that thrifty customers also responded, by splurging. The weirdly effective fix was to add a smiley face to the thrifty bills — like a gold star from teacher.

“People don’t just want to conserve energy,” says Arizona State University psychologist Robert B. Cialdini, “they want to be acknowledged for conserving energy.”

A dozen utilities around the country have contracted with Positive Energy Inc., where Cialdini is a consultant, to use the billing technique. Cialdini is also testing the social norms approach to boost recycling and water conservation. He has found that even if most people in a community don’t actually practice water conservation, you can persuade them to reduce water use simply by telling them that their neighbors at least approve of the idea. “As long as you’re giving people honest information that they don’t already have,” he says, “this is not manipulation. This is education.”

One of the most successful experiments using the social norm dates back to the 1980s in Hood River, Ore., where local civic groups campaigned to enroll entire neighborhoods in a weatherization campaign, so contractors could move efficiently from house to house. “It wasn’t about the marketing budget,” says Ralph Cavanagh of the Natural Resources Defense Council, “it was about creating the impression that all your neighbors were doing it and that it was really unacceptable not to do it. If you didn’t do it, the Boy Scouts showed up at your door wondering what was going on.”

Despite original estimates that 20 to 30 percent of the 3,500 homes in Hood River would participate, the actual results were closer to 90 percent. Cavanagh says that officials from other areas in the U.S. have recently expressed interest in replicating the program.

Some behavioral tweaks — like giving people information in a form they can understand — might seem woefully obvious, except that hardly anyone does it. “Why is the electric meter on the outside of the house, and why is it in units that are meaningless to people?” asks Tony Leiserowitz, director of the Yale Project on Climate Change. “I don’t know what a kilowatt hour is. Why not display it in dollars?”

In some Alaskan communities, power companies install electric meters that require pre-payment with a credit card. Along with telling people how much they’re spending right now, these meters also tap into innate loss aversion, says Leiserowitz: “You’ve invested and want to keep it from running down to zero.” Electricity consumption typically drops 15 percent.

Because so much of the human brain is wired for sight, making consumption visible also works. A British startup, DIY Kyoto, is planning the U.S. launch later this year of its Wattson, a wireless device that displays electrical consumption both numerically and by glowing different colors, from blue to red, as usage increases. Customers can also toy with the social norm response by connecting to a website for comparisons with other Wattson owners.

Some approaches from behavioral economics aim to make pollution more painful — or at least to distribute the pain more equitably. For
Some approaches from behavioral economics aim to make pollution more painful — or at least to distribute the pain more equitably.
instance, in the current auto insurance system, you pay the same premium for driving 5,000 miles a year as your neighbor does for driving 30,000. An alternative approach, Pay As You Drive (PAYD) insurance, matches the premium to the mileage, as reported by GPS or periodic service station inspections. A recent Brookings Institution study calculated that PAYD would save money for two out of three U.S. households, reduce driving by 8 percent, and cut carbon emissions nationwide by 2 percent.

Other behavioral proposals involve making environmental choices painless to the point of being invisible. For instance, many airlines now encourage customers to mitigate the carbon footprint of a flight by buying offsets; it’s an opt-in system. But including the offsets in the ticket price — with customers free to opt out — would dramatically increase participation, and get Virgin Atlantic, say, a lot closer to bragging rights as a genuinely green airline.

Turning a green choice into a status symbol also motivates people disproportionately; in California, for instance, hybrid vehicles get to bypass traffic with a special label giving them access to High Occupancy Vehicle lanes.

Critics complain that behavioral solutions are often more cute or clever than effective, particularly given the scale of a problem like global warming. They tweak the system, but they can’t match $4-a-gallon gas for changing behavior. The influence of social norms, says Paul C. Stern of the National Research Council, tends to be demonstrated “on behaviors that have miniscule environmental effect, and it’s not clear how long the effect lasts.” A technological fix like installing a more efficient furnace, on the other hand, continues to work regardless of what the neighbors are up to.

But Stern acknowledges that weatherization programs with exactly the same incentives have elicited dramatically different consumer response, depending on how they are designed — witness the Oregon program. The trick, says George Loewenstein, is to take conventional economic tools like pricing, subsidies, technology, and taxation, and use behavioral thinking to “supercharge” the way they get delivered.

That may include reshaping the central message of the environmental movement itself. “We know from a lot of psychological research that people are loss averse,” says Leiserowitz, “and the environmental community has done a terrific job of depicting the problem in terms of loss — endangered species, climate change, deforestation. The flip side is that the environmental community has been pretty bad at describing solutions, which often get framed in terms of loss as well: Get rid of your car, turn down the heat, get by with less. It’s disempowering. It makes people give up and do nothing.”

Human nature demands a positive alternative, he says, like the British Transition Towns movement, in which residents of a community together devise a plan for greater resilience, and even happiness, in the face of climate change. For instance, Totnes, in Devon, uses its own currency to encourage reliance on local retailers, and has also developed community-wide campaigns for weatherization, energy-efficient lighting, tree-planting, and gardening. “Martin Luther King didn’t say ‘I have a nightmare,’” says Leiserowtiz. “He said, ‘I have a dream.’ And that’s what made people willing to put their bodies on the line, to bring that vision into being.”

The basic lesson from the behavioral approach, Leiserowitz says, is that the environmental movement also needs to present a vision, to show people what a sustainable world could look like, and what we can do now to make it a reality.

POSTED ON 16 Apr 2009 IN Climate Pollution & Health Sustainability Asia North America 

COMMENTS


Good to see this article! This is the concept behind City of Naperville, together with Partners for Clean Choice, making "Cool Ride-Clean Choice" window clings available for free to drivers of hybrid vehicles in Naperville, Ill.

Hybrids are often poorly marked as such, and our sticker is a soft peer pressure tool to help people spot hybrids on the road — in all their shapes and sizes.

I think of how the anti-smoking campaign has led to many states banning smoking in public buildings being an excellent example of the effects of peer pressure.

Now — if the feds could come up with some real incentives in their pending climate change legislation to encourage people to choose high mileage/low emissions vehicles per vehicle class.


Posted by Kate Delahunt Schrank on 16 Apr 2009


“Martin Luther King didn’t say ‘I have a nightmare,’” says Leiserowtiz. “He said, ‘I have a dream.’ And that’s what made people willing to put their bodies on the line, to bring that vision into being.”

Thanks, Richard Conniff, for reinforcing this truth.
Posted by TRB on 16 Apr 2009


Green is a religion so why not use religious principles like guilt to try and further coerce the public into going along. And if anyone thinks Pay as You Drive insurance scheme's are going to result in lower insurance bills, well, I have a bridge to sell you.

Posted by f1fan on 16 Apr 2009


You mention the British Transition Towns movement, "in which residents of a community together devise a plan for greater resilience, and even happiness." Readers may be interested in the idea of building new towns in the countryside in which people work part-time (18-to-24 hours a week) and in their free time build their own houses, cultivate gardens, and pursue other leisure-time activities. A Gallup poll found that 40 percent of the American people would either definitely or probably like to live this way with another 25 percent indicating possible interest. Industries might be interested because people can work faster and more efficiently for shorter periods of time than for longer, just as in track and field the short-distance runners always run faster than the long-distance runners.

Anyway, I have a book about the idea. It's called THE SOFT PATH: Notes for a New Way of Life in America, and is available online.
Posted by Luke Lea on 30 Apr 2009


Comments have been closed on this feature.
richard conniffABOUT THE AUTHOR
Richard Conniff is a 2007 Guggenheim Fellow and a National Magazine Award-winning writer, whose articles have appeared in Time, Smithsonian, The Atlantic, The New York Times Magazine, and National Geographic. His upcoming book, Swimming With Piranhas at Feeding Time: My Life Doing Dumb Stuff With Animals, is due out from W.W. Norton in May. He is the author of six other books, including The Natural History of the Rich: A Field Guide and Spineless Wonders: Strange Tales of the Invertebrate World. Conniff has also written for Yale Environment 360 about the pursuit of the carbon-neutral building and a green scorecard for rating U.S. economic stimulus projects.
MORE BY THIS AUTHOR

 
 

RELATED ARTICLES


El Niño and Climate Change:
Wild Weather May Get Wilder

This year’s El Niño phenomenon is spawning extreme weather around the planet. Now scientists are working to understand if global warming will lead to more powerful El Niños that will make droughts, floods, snowstorms, and hurricanes more intense.
READ MORE

How Science Can Help to Halt
The Western Bark Beetle Plague

Entomologist Diana Six is focused on the beetle infestation that is wiping out conifer forests in western North America. In an interview with Yale Environment 360, she explains why the key to combating this climate-related scourge is deciphering the trees’ genetic ability to adapt.
READ MORE

To Protect Monarch Butterfly,
A Plan to Save the Sacred Firs

Mexican scientists are striving to plant oyamel fir trees at higher altitudes in an effort to save the species, as well as its fluttering iconic winter visitor — the migrating monarch butterfly — from the devastating effects of climate change.
READ MORE

Why Paris Worked: A Different
Approach to Climate Diplomacy

A more flexible strategy, a willingness to accept nonbinding commitments, and smart leadership by the French all helped secure a climate deal in Paris. The real work lies ahead, but Paris created a strong, if long overdue, foundation on which to begin building a carbon-free future.
READ MORE

Turning Point: Landmark Deal
On Climate Is Reached in Paris

In what could be a turning point, the world’s nations reached an agreement in Paris that would commit them to cutting emissions and keeping global warming below 2 degrees. Although the pledges are not binding, the deal includes a review process to determine if countries are meeting their commitments.
READ MORE

 

MORE IN Analysis


El Niño and Climate Change:
Wild Weather May Get Wilder

by fred pearce
This year’s El Niño phenomenon is spawning extreme weather around the planet. Now scientists are working to understand if global warming will lead to more powerful El Niños that will make droughts, floods, snowstorms, and hurricanes more intense.
READ MORE

How ‘Natural Geoengineering’
Can Help Slow Global Warming

by oswald j. schmitz
An overlooked tool in fighting climate change is enhancing biodiversity to maximize the ability of ecosystems to store carbon. Key to that strategy is preserving top predators to control populations of herbivores, whose grazing reduces the amount of CO2 that ecosystems absorb.
READ MORE

Why Paris Worked: A Different
Approach to Climate Diplomacy

by david victor
A more flexible strategy, a willingness to accept nonbinding commitments, and smart leadership by the French all helped secure a climate deal in Paris. The real work lies ahead, but Paris created a strong, if long overdue, foundation on which to begin building a carbon-free future.
READ MORE

Turning Point: Landmark Deal
On Climate Is Reached in Paris

by fred pearce
In what could be a turning point, the world’s nations reached an agreement in Paris that would commit them to cutting emissions and keeping global warming below 2 degrees. Although the pledges are not binding, the deal includes a review process to determine if countries are meeting their commitments.
READ MORE

Will Paris Conference Finally
Achieve Real Action on Climate?

by fred pearce
The emission pledges from the world’s nations still fall short of the goal for limiting global warming. But as negotiators convene in Paris this week, there is cautious optimism that a significant international agreement on climate can be reached.
READ MORE

Will Indonesian Fires Spark
Reform of Rogue Forest Sector?

by lisa palmer
Massive fires in Indonesia caused by the burning of forests and peatlands for agriculture have shrouded large areas of Southeast Asia in smoke this fall. But analysts say international anger over the fires could finally lead to a reduction in Indonesia’s runaway deforestation.
READ MORE

How China and U.S. Became
Unlikely Partners on Climate

by orville schell
Amid tensions between the U.S. and China, one issue has emerged on which the two nations are finding common ground: climate change. Their recent commitments on controlling emissions have created momentum that could help international climate talks in Paris in December.
READ MORE

Will the Paris Climate Talks
Be Too Little and Too Late?

by fred pearce
At the upcoming U.N. climate conference, most of the world’s major nations will pledge to make significant reductions in greenhouse gas emissions. But serious doubts remain as to whether these promised cuts will be nearly enough to avoid the most severe impacts of climate change.
READ MORE

Global Extinction Rates: Why
Do Estimates Vary So Wildly?

by fred pearce
Is it 150 species a day or 24 a day or far less than that? Prominent scientists cite dramatically different numbers when estimating the rate at which species are going extinct. Why is that?
READ MORE

Why the Fossil Fuel Divestment
Movement May Ultimately Win

by marc gunther
The fossil fuel divestment campaign has so far persuaded only a handful of universities and investment funds to change their policies. But if the movement can help shift public opinion about climate change, its organizers say, it will have achieved its primary goal.
READ MORE


e360 digest
Yale
Yale Environment 360 is
a publication of the
Yale School of Forestry
& Environmental Studies
.

SEARCH e360



Donate to Yale Environment 360
Yale Environment 360 Newsletter


CONNECT


ABOUT

About e360
Contact
Submission Guidelines
Reprints

E360 en Español

Universia partnership
Yale Environment 360 articles are now available in Spanish and Portuguese on Universia, the online educational network.
Visit the site.


DEPARTMENTS

Opinion
Reports
Analysis
Interviews
Forums
e360 Digest
Podcasts
Video Reports

TOPICS

Biodiversity
Business & Innovation
Climate
Energy
Forests
Oceans
Policy & Politics
Pollution & Health
Science & Technology
Sustainability
Urbanization
Water

REGIONS

Antarctica and the Arctic
Africa
Asia
Australia
Central & South America
Europe
Middle East
North America

e360 VIDEO

“video
Tribal people and ranchers join together to stop a project that would haul coal across their Montana land.
Watch the video.

e360 MOBILE

Mobile
The latest
from Yale
Environment 360
is now available for mobile devices at e360.yale.edu/mobile.

e360 VIDEO

“Battle
The 2015 Yale e360 Video Contest winner documents a Northeastern town's bitter battle over a wind farm.
Watch the video.

e360 VIDEO

“Alaska
A 2015 Yale e360 Video Contest winner captures stunning images of wild salmon runs in Alaska.
Watch the video.

e360 VIDEO

Food waste
An e360 video series looks at the staggering amount of food wasted in the U.S. – a problem with major human and environmental costs.
Watch the video.

e360 VIDEO

Colorado wildfires
An e360 video goes onto the front lines with Colorado firefighters confronting deadly blazes fueled by a hotter, drier climate.
Watch the video.

e360 SPECIAL REPORT

“Tainted
A three-part series Tainted Harvest looks at the soil pollution crisis in China, the threat it poses to the food supply, and the complexity of any cleanup.
Read the series.

OF INTEREST



Yale