Richard Thaler's Nudge

Richard Thaler, Professor of Behavioral Science and Economics at the Graduate School of Business, University of Chicago.

What is the big idea of Richard Thaler, the economist quoted by David Cameron and Barack Obama? It comes down to this: you're not as smart as you think. Humans, he believes, are less rational and more influenced by peer pressure and suggestion than governments and economists reckon.

"Economists assume people have brains like supercomputers that can solve anything," says Thaler. "But human minds are more like really old Apple Macs with slow processing speeds and prone to frequent crashes."

According to this view, voters are less Mr Spock than Homer Simpson and they could do with a bit of help - what Thaler terms a "nudge" - to save more, eat more healthily and do all the other things that they know they should.

Cameron is so interested in the idea that in a speech last month he mentioned Thaler, his co-author Cass Sunstein and even the fact they had a new book out, Nudge. He then summed up their argument: "One of the most important influences on people's behaviour is what other people do ... with the right prompting we'll change our behaviour to fit in with what we see around us." It was surely the best plug two Chicago academics with a book about the obscure discipline of behavioural economics could hope for.

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Why do I include this article, written on July 12, 2008? Well it was important enough to me that I bookmarked in my favorites and ran across it the other day. Reviewed it again. Liked it in that same sprit of the books 'Blink' and 'Freakonomics.'

WhenI saw that all most of us need is a little nudge in one direction, it became clear to me what that nudge is many times... nonverbal language. Combine the nudge principle, with the proven facts from studies, that when giving a speech, your listeners are more likely to remember what happened in the first 3 minutes and the last three minutes, it all becomes clear that we need to focus even more on what we are saying with our nonverbal behavior than ever before.◦

Richard Thaler's Nudge