Business

Event Summary - 2009 Behavior, Energy and Climate Change Conference


By Stefanie Bowles.

We feature notes from Stephanie Bowles on a couple of talks from
the 2009 Behavior, Energy and Climate Change (BECC) conference in
Washington DC: “A conference focused on understanding the behavior and
decision-making of individuals and organizations and on using that
knowledge to accelerate our transition to an energy-efficient and
low-carbon future.” (Nov 15-18, 2009). It was their third annual
conference.

Karen Ehrhardt-Martinez - BECC 2009 Conference Chair

This conference started from the premise that society’s response to
the environmental crisis needs to better balance technological
innovations with social and behavioural change. They point out that we
already have many environmentally preferable choices that we could be
making, but that people are not making them. Dramatic change is
needed, and any solution must have people at the center.

Residential energy use accounts for 38% of total energy consumption,
people centered initiatives could result in near term savings of 25%
(Gardner and Stern 2008, Lartner, Ehrhard, Martinez, 2009 and Dietz
et. al 2009), equivalent to the emissions of the UK, France and
Germany. http://www.pnas.org/content/106/44/18452.full.pdf+html

The role of technology needs to be re-envisioned for what it is—tools
that allow people to change their behavior; as means to an end, not an
end in and of themselves. We need to understand the choice
architecture in which people make decisions, and become informed by
social and behavioural disciplines. There is a lot of systemic
inertia, in which the default or standard option is often biased
against the status quo. If you change the default option, it can be
very powerful in changing practices.

To test this theory, the BECC conference organizers made the veggie
lunch option the default for the conference, and you had to opt in for
the meat option. Meat eating went from 95% to 20% with this simple
change, and we know this makes a difference because omnivores produce
7x the amount of GhG’s as vegans.

We need an energy revolution that brings people back in and puts them
at the centre.

Dan Ariely - Opening Keynote: Energy Usage: a View from
Behavioral Economics

Behavioural economics tests our intuitions which inform our choices,
and shows that we make systematic repeatable mistakes all the time,
even in instances where we have very strong senses to inform our
intuitions, such as our sense of sight. He showed a picture of two
tables, one which looked longer than the other, and showed that they
were in fact the same length. He showed a picture of two colours in a
Rubic's cube which looked completely different, but were actually the
same colour. If we make these types of mistakes in these areas where
we have strong senses, we will certainly make them in other areas,
such a financial decisions, health decisions and climate change. He
then went on to say that he could not design a problem that people
would care about less than climate change: it’s about the future, it
will happen to other people, and anything I do is a drop in the
bucket.

He then gave some examples of dramatically different organ donation
statistics across a handful of countries (Johnson and Goldstein 2003).
In the Netherlands, they mounted an enormous public “begging” campaign
to get people to opt in to donate and got it up top 28%. In the
country where organ donation was the default (I think Germany) and
people had to opt out, the donation was 100%. Defaults are everywhere
(e.g. retirement savings, urinal catheters, etc.).

We don’t know our preferences very well as humans. We like to think
that we decide everything, but we function within choice architectures
which impact what we chose. He then asked the audience if they could
think of 3 or 10 reasons why they love their significant other. Turns
out people can usually only think of 3, and that most people run out
of reasons! People are very influenced in the moment and get confused
with too much data—he likes to use this on his students to ask them 15
ways the class can be improved. People’s preferences are not fully
formed.

Even with financial decisions, people don’t really make them, they
rely on habits and do not make choices in isolation, and they are
always relative. He then gave more examples which surveyed women using
photos of different men, asking them who they would like to date. The
answers changed when some pictures were removed, illustrating the
relativity of our decisions. Paternalism becomes harder to avoid when
you know that people don’t actually know their preferences.

There are also a major short-term vs. long-term factors which come in
to play in our decisions—gym, deserts, unprotected sex, taking
medications, etc. Long term reward vs. short term reward/sacrifice…
can we get people to care about the future? Can we get people to act
in the short term as if they care about the long term?

We have self-control problems—how many people text or email while
driving? Rationally, you don’t ask—how much do I care about living?
Killing other people?

There are ways to control our self-control problems, such as
pre-paying for colonoscopies where if you don’t go, you won't get your
money back. You can buy alarm clocks with wheels that move around the
room so you can’t hit the button and go back to sleep. They also have
alarm clocks where you donate money to a charity you hate every second
you sleep in. There is also something called Xwatch, where when you
watch pornography, other people will know.

We all know we have good intentions sometimes, how can we get people
to sign on to self-control mechanisms when people are in a thoughtful
place?

You wouldn’t say at the end of a date, “I paid $125 for the date,
therefore now you owe me $125 worth of sex.” Of course not. Mentioning
price changes how people understand their role. A general finding from
psychology is that social and financial motivations don’t add, they
substitute themselves. For example, people will work hard at something
if you ask them as a favour (social motivation) but will not work hard
if you give them a small amount of money to do the same task. If you
pay them a lot though, they will work hard.

There are similar studies in the world of gifts: small gifts remain in
the social domain, but the moment someone mentions money there is a
negative social effect (e.g. you wouldn’t just give someone $20
instead of a bottle of wine if you went over to their house for
dinner). As we make things more about money, we lose the social
contract. This is very powerful, says Ariely.

They did further studies to see if the social motivator would come
back after you went to a financial reward, and they found that no, it
did not come back. Once you create a financial reward structure its
very hard to get the social reward structure back.

Vis a vis traditional economists, behavioural economists think that
people are less smart/rational – we are emotional, vindictive, don’t
know what we want, are easily confused. However, we acknowledge we
need help in the physical world (e.g. technologies to make us go
faster, farther, etc) but in the mental world we like to think we are
beyond reproach. Behavioural economics seeks to provide tools to help
us in the mental world. We need to identify the systematic ways people
make mistakes and fix them.


Front Image Credit: jdurham

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