Friday, November 20, 2009

When Behavioral Economics Meets Climate Change

Here's a fun little anecdote from Marc Gunther that has bigger implications for how we advance our transition to a Green Economy:

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 percent will request it.

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

Some 80 percent 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 percent to 17 percent margin.

As for the larger implications of the above findings, reports Gunther, these are what Behavioral Economists talk about:

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.

It's a fascinating topic -- one that we'll continue to follow for you here at CV Notes.  You can find related posts under our "Motivating Change" category...

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