Behavioural Insights Unit: On the value of nudging

February 3, 2016

BIU Work Streams!

We work with ministries and agencies to design more effective and efficient public services by incorporating our best understandings of how people use those services!

Education!!

introduce a behavioural science perspective to the OPS and raise awareness of opportunities to apply behavioural science methodologies!

Design & Evaluation!!

design service touch points in light of existing behavioural science knowledge and evaluate these designs using randomized controlled trials to generate new, Ontario specific knowledge!

Expert Advice!!

provide program specific insight from the behavioural sciences!

!Our Value Proposition ! •  We offer a new tool in the government’s toolkit:

–  Legislation, regulation & taxation – shoving –  Marketing, disclosure – shouting

–  Behavioural insights – nudging

•  This new tool offers: –  Effective solutions that often cost nothing to test or

implement –  An alternative to complex legislation and costly marketing –  The ability to help citizens’ make sustainable decisions

without constraining their freedom

•  In addition, we conduct evidence-based evaluation –  Using scientific methodology and statistical evaluation

Global Insights Initiative

Growing Global Adoption

Behavioural Insights Unit

Economic Model of Decision Making In order to decide whether •  to stay in school •  to eat a healthy diet •  to save for retirement

But often, we don’t have the… •  time •  memory •  awareness •  ability •  or motivation to engage in a complex cost-benefit analysis Instead we often make decisions automatically by using mental shortcuts

Taxes Fines

Incentives

Information

Behavioural Economics in 3 Points

First Law of Motion Every object in a state of motion tends to remain in that state of motion unless an external force is applied to it.

1.  Procrastination often prevents people from achieving their goals

3. Context surrounding a decision can influence the choices people make

2. Habit can prevent people from adapting to changing circumstances

Mental Shortcuts often Make use of Contextual Information

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Context Matters!

Basic nudge idea: changing the context surrounding behaivour can influence that behaviour above and beyond incentives, regulation, and information. This can provide governments with new tools to encourage positive behaviour change.

Randomized Controlled Trials!(RCTs)!

1.  Evidence-based decisions!

–  Gold standard of the scientific method!

2.  Efficient innovation!–  Rather than trying one solution, you

can try multiple simultaneously!

3.  Lower risk and lower cost!–  Know whether something works with

a sample of the population before rolling it out province wide!

OPS EXAMPLES Behavioural Insight Unit’s

Tax Collection Eservice adoption Organ Donation

When

Where

How

EmployerHealthTaxRequirementtoFile

EmployerHealthTax:XXXX

IfyourEmployerHealthTaxReturnhasbeenfiled,pleasedisregardthisnoBce.

WehavenotreceivedyourEmployerHealthTaxAnnualReturn(s)forthefollowingcalendaryear(s):

31-Dec-2013

Yourreturnwasdueonorbefore15-Mar-2014.Pleasecompleteandfileyourreturnwithfullpaymentimmediately.Interestandpenaltychargeswillapply.

YourreturnmustbefiledimmediatelywithfullpaymentinordertopreventfurtherinterestchargestoyouorreferraltotheCollecBonsBranch.Con$nuedfailuretofiletherequiredreturnisaseriousoffence.Ifarrangementsarenotmadetocorrectthissitua$on,theministrymayfileanes$matedreturnincludingapplicablepenal$esandinterestforeachperiodthatisindefault.

IfyouhaveanyquesBonsorrequireaddiBonalinformaBon,pleasevisitourwebsiteorcalltheMinistryofFinanceatthenumberlistedbelow.

Enquiries1866ONT-TAXSFAX1866888-3850Teletypewriter(TTY)1800263-77761866668-8297 Internetontario.ca/finance

YourEmployerHealthTaxAnnualReturnIsOverdue!

Youmustfileimmediately.EmployerHealthTax:XXXXWehavenotreceivedyourEmployerHealthTax(EHT)AnnualReturn(s)forthefollowingcalendaryear(s)31-Dec-2013Yourreturnwasdueonorbefore15-Mar-2014.Youmustfileyourreturn(s)immediatelywithfullpaymenttoavoidfurtherinterestandpenaltycharges.Ifyoufailtodeliveryourreturn(s)by2-May-2014,theMinistryofFinancewillreferyoutocollecBons.ThiscouldhaveescalaLnglegalconsequencesasfailuretofileareturnisaseriousoffence.Hereiswhatyouneedtodonowanddefinitelybefore2-May-2014:

1) Fileandpayyourreturn(s)infullimmediately:a. BymailtoMinistryofFinance,33KingStreetWest,POBox620,Oshawa,OntarioL1H8E9b. InpersonatselectedServiceOntariocentres,seeh_p://www.ontario.ca/findservicesc. Ifyoualreadyregisteredonline,logontoONT-TAXS,ath_p://www.ontario.ca/taxservices

2) Keepacopyforyourrecords.

IfyouhavefiledyourEmployerHealthTaxreturn,pleasedisregardthisnoBce.IfyouhaveanyquesBonsorrequireaddiBonalinformaBon,pleasevisitourwebsiteatontario.ca/financeorcalltheMinistryofFinanceat1866668-8297.

Standard Letter Trial Letter

10.0%

20.0%

30.0%

40.0%

50.0%

Standard Letter Experimental Letter

Standard Letter Experimental Letter

2014 2015

Filed within one month

Filed Before Collections

30.6%

Percent of Employers Filing by Letter and Date

42.7% of employers filed within 2 months of receiving requirement-to-file letters in 2013

44.2% 48.3% 49.6%

44.4%

17%

11.8%

32.4%

17.7%

27.4%

26.1%

23.5%

If you build it… Will they come? •  Online government services save money

– About $6.39 per transaction –  6.5 million valtag transactions annually

•  Ontarians want online services –  87% shop online –  84% want government services online

•  Yet only 10.4% renewed online in 2013 –  In-person sticker renewals cost $35 million annually

Which Tool Works Best? •  Not providing or charging extra for in-person service

likely unpopular •  Multi-year, million dollar advertising campaigns have

produced only modest increase in online adoption

0%

10%

20%

30%

40%

50%

2011 2012 2013

Per

cent

of

All

Tran

sact

ions

C

ompl

eted

Onl

ine

Online Licence Sticker Renewals

2014

Standard Renewal Materials (Control)

Intervention 1 – salient information

Intervention 2 – multiple motivations

Intervention 3 – loss aversion

Stickers Renewed Online by Condition

0%

5%

10%

15%

Standard Notification Materials

Intervention 1 Intervention 2 Intervention 3

10.3%

11.6%

14.6% 13.3%

Late Sticker Renewals (all channels) by Condition

15%

20%

25%

30%

Standard Notification Materials

Intervention 1 Intervention 2 Intervention 3

29.6%

25.8% 26.4%

24.4%

Shift to Online Results

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Simplified Form

Standard Form

How would you feel if you or someone you love needed a transplant and couldn’t get one? Please help save lives and register today.

Organ Donor Registration !Results!

Behavioural Insights Unit !!Julian House!Research Scientist!Communications Branch!Treasury Board Secretariat!416-326-2562!Julian.House@ontario.ca!!