Overview
Two decades ago, behavioral economics burst from academia to the halls of power, claiming that correcting individual irrationalities could transform society. The claim, championed by the Obama administration, was that almost any severe societal problem—from retirement planning to climate change—could be healed with the right behavioral bandage. All we had to do was nudge.
It was all very convenient, and false. As behavioral scientists Nick Chater and George Loewenstein show in It's on You, nudge policies rarely work, and divert us from policies that do. For example, nudge-inspired “opt-out” 401(k) programs turn out not to boost saving, and distract from the real source of the retirement crisis: the systematic destruction of pensions.
It's on You shows how across a wide range of issues—from pensions to obesity to climate change—the rich and powerful have pulled off a sleight of hand: blaming individuals for social problems while lobbying to shape the rules in their own favor, with behavioral economics an unwitting accomplice. If we want to solve those problems, we must rewrite the rules for the common good, rather than try to “fix” the victims of bad policies.
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