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← How to change your behavior for the better

What's the best way to get people to change their behavior? In this funny, information-packed talk, psychologist Dan Ariely explores why we make bad decisions even when we know we shouldn't -- and discusses a couple tricks that could get us to do the right thing (even if it's for the wrong reason).

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Showing Revision 7 created 11/18/2019 by marialadias.

  1. Hi.
  2. You might have noticed
    that I have half a beard.
  3. It's not because I lost a bet.
  4. Many years ago, I was badly burned.
  5. Most of my body is covered with scars,
  6. including the right side of my face.
  7. I just don't have hair.
    That's just how it happened.
  8. It looks symmetrical, but almost.
  9. Anyway, now that we discussed facial hair,

  10. let's move to social science.
  11. And in particular, I want us to think
    about where is the potential for humanity
  12. and where we are now.
  13. And if you think about it,
    there's a big gap
  14. between where we think we could be
    and where we are,
  15. and it's in all kinds of areas.
  16. So let me ask you:

  17. How many of you in the last month
    have eaten more than you think you should?
  18. Just kind of general. OK.
  19. How many of you in the last month have
    exercised less than you think you should?
  20. OK, and for how many of you
    has raising your hands twice
  21. been the most exercise you got today?
  22. (Laughter)

  23. How many of you have ever
    texted while driving?

  24. OK, we're getting honest.
    Let's test your honesty.
  25. How many people here in the last month
  26. have not always washed your hands
    when you left the bathroom?
  27. (Laughter)

  28. A little less honest.

  29. By the way, it's interesting how we're
    willing to admit texting and driving
  30. but not washing our hands,
    that's difficult.
  31. (Laughter)

  32. We can go on and on.

  33. The problem, the topic is
    that there's lots of things
  34. when we know what we could do --
  35. we could be very, very different,
    but we're acting in a very different way.
  36. And when we think
    how do we bridge that gap,
  37. the usual answer is, "Just tell people."
  38. For example, just tell people
    that texting and driving is dangerous.
  39. Did you know it's dangerous?
    You should stop doing it.
  40. You tell people something
    is dangerous, and they will stop.
  41. Texting and driving is one example.

  42. Another very sad example
    is that in the US,
  43. we spend between seven
    and eight hundred million dollars a year
  44. on what's called "financial literacy."
  45. And what do we get
    as a consequence of that?
  46. There was recently a study that looked
    at all the research ever to be conducted
  47. on financial literacy --
    what's called a meta-analysis.
  48. And what they found is that
    when you tell people,
  49. you teach them financial literacy,
  50. they learn and they remember.
  51. But do people execute? Not so much.
  52. The improvement is about
    three or four percent
  53. immediately after the course,
  54. and then it goes down.
  55. And at the end of the day,
  56. the improvement is about 0.1 percent --
  57. not zero, but as humanly close
    to zero as possible.
  58. (Laughter)

  59. So that's the sad news.

  60. The sad news is, giving
    information to people
  61. is just not a good recipe
    to change behavior.
  62. What is?
  63. Well, social science
    has made lots of strides,

  64. and the basic insight is that
    if we want to change behavior,
  65. we have to change the environment.
  66. The right way is not to change people,
    it's to change the environment.
  67. And I want to present a very simpleminded
    model of how to think about it:
  68. it's to think about behavioral change
  69. in the same way that we think about
    sending a rocket to space.
  70. When we think about
    sending a rocket to space,
  71. we want to do two main things.
  72. The first one is to reduce friction.
  73. We want to take the rocket
    and have as little friction as possible
  74. so it's the most aerodynamic possible.
  75. And the second thing is we want
    to load as much fuel as possible,
  76. to give it the most amount
    of motivation, energy to do its task.
  77. And behavior change is the same thing.
  78. So let's first talk about friction.

  79. In this particular case study
    I'll tell you about,
  80. there's a pharmacy, an online pharmacy.
  81. Imagine you go to your doctor.
  82. You have a long-term illness,
  83. your doctor prescribes
    to you a medication,
  84. you sign up for this online pharmacy
  85. and you get your medication
    in the mail every 90 days.
  86. Every 90 days, medication,
    medication, medication.
  87. And this online pharmacy
    wants to switch people
  88. from branded medication
    to generic medication.
  89. So they send people letters, and they say,
  90. "Please, please, please,
    switch to generics.
  91. You will save money, we will save money,
    your employer will save money."
  92. And what do people do?
  93. Nothing.
  94. So they try all kinds of things
    and nothing happens.

  95. So for one year, they give people
    an amazing offer.
  96. They send people a letter, and they say,
  97. "If you switch to generics now,
    it will be free for a whole year."
  98. Free for a whole year. Amazing!
  99. What percentage of people
    do you think switched?
  100. Less than 10 percent.
  101. At this point, they show up to my office.
  102. And they come to complain.
  103. Why did they pick me?
  104. I wrote a couple of papers
    on the "allure of free."
  105. In those papers, we showed
    that if you reduce the price of something
  106. for, let's say, 10 cents to one cent,
    nothing much happens.
  107. You reduce it from one cent to zero,
    now people get excited.
  108. (Laughter)

  109. And they said, "Look, we read these
    papers on 'free,' we gave 'free.'

  110. Not working as we expected.
  111. What's going on?"
  112. I said, "You know, maybe
    it's a question of friction."
  113. They said, "What do you mean?"
  114. I said, "People are starting with branded.
  115. They can do nothing and end with branded.
  116. To move to generic, they have to choose
    generic over branded,
  117. but they also have to do something.
  118. They have to return the letter."
  119. So this is what we call
    a "confounded design."
  120. Two things are happening at the same time.
  121. It's branded versus generic,
  122. but it's doing nothing
    versus doing something.
  123. So I said, "Why don't we switch it?
  124. Why don't we send people a letter
    and say, 'We're switching you to generics.
  125. You don't need to do anything.
  126. If you want to stay with branded,
    please return the letter.'"
  127. (Laughter)

  128. Right?

  129. What do you think happened?
  130. Lawyers, lawyers happened.
  131. (Laughter)

  132. It turns out, this is illegal.

  133. (Laughter)

  134. By the way, for brainstorming
    and creativity,

  135. doing things that are illegal
    and immoral, it's fine,
  136. as long as it's just
    in the brainstorming phase.
  137. (Laughter)

  138. But this was the purity of the idea,

  139. because the initial design was
    the branded had the no-action benefit.
  140. In my illegal, immoral design,
    generic had the no-action benefit.
  141. But they agreed to give people
    a T-intersection:
  142. send people a letter and say,
  143. "If you don't return this letter,
  144. we will be forced
    to stop your medications.
  145. But when you return the letter,
    you could choose branded at this price,
  146. generic at this price."
  147. Now people had to take an action.
  148. They were on even footing. Right?
  149. It wasn't that one had
    the no-action benefit.
  150. What percentage do you think switched?
  151. The vast majority switched.
  152. So what does it tell us?
  153. Do people like generics,
    or do we like branded?
  154. We hate returning letters.
  155. (Laughter)

  156. This is the story of friction:
    small things really matter.

  157. And friction is about taking
    the desired behavior
  158. and saying: Where do we have
    too much friction
  159. so it's slowing people down
    from acting on it?
  160. And every time you see
    that the desired behavior
  161. and the easy behavior are not aligned,
  162. it means we want to try and realign them.
  163. That's the first part.
    We talked about friction.

  164. Now let's talk about motivation.
  165. In this particular study,
  166. we were trying to get very poor people
    in a slum called Kibera in Kenya
  167. to save a little bit of money
    for a rainy day.
  168. You know, if you're very, very poor,
    you have no extra money,
  169. you live hand to mouth,
  170. and from time to time, bad things happen.
  171. And when something bad happens,
    you have nothing to draw on, you borrow.
  172. The Kibera people can borrow at sometimes
    up to 10 percent interest a week.
  173. And then, of course,
    it's really hard to get out of it.
  174. You live hand to mouth,
    something bad happens,
  175. you borrow, things get worse
    and worse and worse.
  176. So we wanted people to keep
    a little bit of money for a rainy day.
  177. And we thought about
    what is the motivation,
  178. what is the fuel that we need to add?
  179. And we tried all kinds of things.
  180. Some people, we texted them
    once a week and said,
  181. "Please try to save 100 shillings" --
    about a dollar -- "this week."
  182. Some people, we sent a text message
    as if it came from their kids.
  183. So it said, "Hi Mom, hi Dad,
    this is little Joey" --
  184. whatever the name of the kid was --
  185. "Try and save 100 shillings this week
    for the future of our family."
  186. Right? I'm Jewish, a little bit
    of guilt always works.
  187. (Laughter)

  188. Some people got 10 percent.

  189. "Save up to a hundred shillings,
    we'll give you 10 percent."
  190. Some people got 20 percent.
  191. Some people got also
    10 percent and 20 percent,
  192. but they got it with loss aversion.
  193. What is loss aversion?
  194. Loss aversion is the idea
    that we hate losing
  195. more than we enjoy gaining.
  196. Now, think about somebody
    who is in a 10-percent condition
  197. and they put 40 shillings in.
  198. They put 40 shillings,
    we give them four more,
  199. they say thank you very much.
  200. That person gave up six.
  201. They could have gotten six more
    if they gave a hundred,
  202. but they don't see it.
  203. So we created what we call pre-match.
  204. We put the 10 shillings in
    at the beginning of the week.
  205. We said, "It's waiting for you!"
  206. And then if somebody puts 40 in,
    we say, "Oh, you put 40 in,
  207. we're leaving four,
    and we're taking six back."
  208. So in both cases, pre-match or post-match,
  209. people get 10 percent.
  210. But in the pre-match,
  211. they see the money they did not match
    leaving their account.
  212. So we have text, text from kids,
    10 percent, 20 percent,
  213. pre-match, post-match.
  214. And we had one more condition.
  215. It was a coin about this size,
  216. with 24 numbers written on it.
  217. And we asked them to put the coin
    somewhere in their hut,
  218. and every week, take a knife
    and scratch the number for that week --
  219. week one, two, three, four --
  220. scratch it like a minus
    if they didn't save
  221. and scratch it up and down if they saved.
  222. Now, think to yourself:

  223. Which one of those methods
    do you think worked the best?
  224. Text, text from the kids,
    10 percent, 20 percent,
  225. beginning of the week,
    end of the week, and the coin?
  226. I'll tell you what
    the average people think.
  227. We've done these studies of prediction,
  228. both in the US and in Kenya.
  229. People think that 20 percent
    will get a lot of action,
  230. 10 percent less,
  231. the rest of it will do nothing --
  232. kids, coin, doesn't matter.
  233. People think loss aversion
    will have a small effect.
  234. What actually happened?

  235. Sending a text reminder once a week
  236. helps a lot.
  237. Good news!
  238. This program lasted six months.
    People forget. Reminding people is great.
  239. Ten percent at the end
    of the week helped some more.
  240. Financial incentives work.
  241. Twenty percent at the end of the week --
    just like 10 percent, no difference.
  242. Ten percent in the beginning of the week
  243. helps some more.
  244. Loss aversion works.
  245. Twenty percent in
    the beginning of the week,
  246. just like 10 percent in the beginning
    of the week, no difference.
  247. And the text message from the kids
    was just as effective
  248. as 20 percent plus loss aversion --
  249. which is amazing, right?
  250. It's amazing how motivating
    messages from kids were.
  251. And one conclusion is
    we don't use kids enough.
  252. (Laughter)

  253. And, of course, I don't mean
    in a child labor sense.

  254. But if you think about
    parents and their kids,
  255. we are the best that we can for our kids,
  256. and we think about the future,
  257. and I think we should think
  258. about how to use that amazing
    source of motivation
  259. to get parents to behave in a better way.
  260. But the big surprise
    of this study was the coin.

  261. The coin basically doubled savings
    compared to everything else.
  262. And now the question is: Why?
    What was it about the coin?
  263. So I'll tell you how I started
    thinking about the coin,
  264. and then we'll come back to it.
  265. So you know, when I do research
    on, let's say, buying coffee,

  266. I don't need to go anywhere.
    I can sit in my office.
  267. I've bought enough coffee.
    I know how it works.
  268. The details, I'm familiar with.
  269. When you do research in some
    of the poorest places in the world,
  270. you have to go and visit
    and see what's going on
  271. and get some insight
    about how the system works.
  272. And on that particular day,
  273. I'm in a place called Soweto
    in South Africa,
  274. and I'm sitting in a place
    that sells funeral insurance.
  275. You know, in the US people spend
    crazy amounts of money on weddings?
  276. In South Africa, it's funerals.
  277. People spend up to a year
    or two years of income on funerals.
  278. And I sit in this place --
  279. by the way, before you judge the South
    Africans as being irrational with this,
  280. I just want to remind you
  281. that spending a lot of money
    on funerals compared to weddings,
  282. at least you know for sure
    you only have one.
  283. (Laughter)

  284. OK, so I sit in this place
    that sells funeral insurance.

  285. And this guy comes in with his son --
    his son is about 12 --
  286. and he buys funeral insurance for a week.
  287. It will cover 90 percent
    of his funeral expense
  288. only if he dies in the next seven days.
  289. Right? These are very poor people,
    they buy small amounts of insurance
  290. and small amount of soap and such.
  291. And he gets that certificate,
  292. and in a very ceremonious way,
    he gives it to his son.
  293. And as he gives it to his son,
    I think to myself, why the ceremony?
  294. What is this father doing?
  295. Now, think about the breadwinner
    that decides on that particular day
  296. to direct some money
    into insurance or savings.
  297. What is the family going to see tonight?
  298. They're going to see less.
  299. Right? At that level of poverty, there'll
    be less food, less kerosene, less water --
  300. something less tonight.
  301. And what his father was doing
    and what our coin was trying to do
  302. is to say, yes, there's less
    food on the table,
  303. but there's another activity.
  304. You see, what happened is, there are
    many good, important economic activities,
  305. like savings and insurance,
    that are invisible.
  306. And now the question is:
    How do we make them visible?
  307. So let's go back to our rocket model.

  308. We have to, first of all,
    look at the system
  309. and see where there's little things
    we can fix, with friction,
  310. where is there
    that we can remove friction?
  311. And then the next thing we want to do
    is to think broadly about the system,
  312. and say: What other motivations
    can we bring in?
  313. And that's a much more difficult exercise,
  314. and we don't always know
    what would work best.
  315. Is it going to be money?
    Is it going to be loss aversion?
  316. Is it going to be
    something that is visible?
  317. We don't know, and we have
    to try different things.
  318. We also have to realize that
    our intuition sometimes misleads us.
  319. We don't always necessarily know
    what would work the best.
  320. So if we think about this gap

  321. between where we could be
    and where we are,
  322. it's a really sad thing to see this gap
    and to think about it.
  323. But the good news is,
    there's lots we can do.
  324. Some of the changes are easy,
    some of the changes are more complex.
  325. But if we'll attack each problem directly,
  326. not by just providing
    more information to people
  327. but trying to change the friction,
  328. add motivation,
  329. I think we can ...
  330. Can we close the gap? No.
  331. But can we get much better?
    Absolutely, yes.
  332. Thank you very much.

  333. (Applause)