Seminar: Dilip Soman

Scaling Choice Architecture Interventions

Dilip Soman

Abstract

Choice architecture interventions are now being increasingly used in deploying behavioural interventions on a large scale, with the goal of helping citizens make better decisions. Many of these interventions are designed by mimicking other successful projects, or by conceptually extending ideas from published academic research. In this talk, I will describe two such specific interventions in the area of financial wellbeing. The first intervention is an initiative by the government in South Korea on helping consumers make better spending decisions while using credit cards by sending text messaging alerts after every instance of credit card use. The second set of interventions in Mexico use a redesigned pension account statement and text messaging alerts designed to motivate and remind citizens to make (recommended) voluntary contributions to their pension accounts. Both sets of interventions were designed on the basis of a conceptual analysis of evidence published in the behavioural sciences. Results in both cases show that while the intervention worked for a subset of the target population, it did not work (and in some cases, actively backfired) for others. In South Korea, the intervention was only successful for 15% of the recipients. For the other 85%, a different psychological process (which arose from the particular design features of the intervention) played a stronger role and resulted in an opposite effect. Our results point to the importance of pre-testing interventions especially in domains where we expect strong context dependence.  In Mexico, the strength of the effect varied as a function of age and gender. We were able to use machine learning to detect the effects of the heterogeneity. In ongoing work, we plan to customize the choice architecture interventions to account for heterogeneity.

Biographical Sketch

Dilip is a Canada Research Chair in Behavioural Science and Economics, and is the Director of the Behavioural Economics in Action Research Centre at Rotman [BEAR]. His research is in the area of behavioural science and its applications to individual wellbeing (financial wellbeing, health and wellness), policy, welfare programs, and business (customer experience, pricing). He is the author of several books including "The Last Mile (UTP: 2015)" and teaches a massive open online course "BE101X: Behavioural Economics in Action" on EdX. He has degrees in Engineering (Bombay), Management (IIM) and Behavioural Science and Business (Chicago). He serves on the advisory / research boards of Impact Canada (Privy Council Office) and the Financial Consumer Agency of Canada, and has previously taught in U.S.A. and Hong Kong.

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