Behavioural Insights (BI) is a problem-driven approach for applying and experimentally testing solutions based on behavioural science insights/evidence. BI designs and tests people-centered policies and interventions using evidence and experimental methods from disciplines such as social psychology, cognitive science, neuroscience, behavioural economics and other social sciences. BI provides solutions to address key challenges in order to improve community's socio-economic status. These solutions take into account how people actually process information, make decisions, and think about, influence, and relate to one another. In many cases, such solutions entail framing options in a way that encourages a desired course of action while allowing decision makers to exercise their freedom of choice. This strategy is also known as "choice architecture." A behavioral approach priotizes mindsets, decision making framework, and the social environment. BI attempts to discover the many irrational factors that influence decision making and seeks to improve the well-being of society and it's people through sound experimental methodologies.
Public policy influences almost all aspects of our lives. From driving safely to conserving natural
resources, policies are shaping the way we act everyday.
Conventionally, approaches in policy making have relied on the assumption that human behavior is fully rational. This assumption is questioned by the emergence of behavioral economics, which states that human beings are not naturally rational and unbiased. Real people don’t always behave like robots like classical economic theories assume (Thaler, 2000).
The ideal rational individual described in classical economic theory is called “homo economicus”. To a homo economicus the way in which choices are presented to them (choice architecture) doesn't matter, as they will make the optimal choices disregarding the way these choices are presented to them
In reality the choice architecture matters in everyday decision making. For example, most people opt
for the default choice when they are presented with one, this is called “anchoring bias” (Tversky
and Kahneman, 1974). There are many other cognitive biases that often drive our perception and
choices that we make.
Therefore, an understanding of behavior can inform interventions that can make policies have even greater impact. By understanding behavioural insights, policy makers can facilitate behavioural interventions or nudges into their policy making keeping people at the center. This further pushes governments to take a more realistic view of human behaviour than they have in the past. Behavioural approaches offer a potentially powerful new set of tools for policymakers that aid in understanding the structural context that drives decision-making which may result in structural solutions to policy challenges such as illiteracy, malnutrition, environmental sustainability, child labour, child marriage and so on.
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