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Nudge Nudge

The government must offer shrewder incentives to do the right thing

The behavioural insights team set up by the prime minister 18 months ago has had some notable successes. Known as the nudge unit, it persuaded people behind on their taxes to pay up by pointing out that taxes pay for the NHS and schools. Student drop-out rates on a government-sponsored course were reduced when students were sent encouraging texts.

By harnessing the basic principle of reciprocity, they increased charitable giving by sending potential donors a personal appeal and a bag of sweets. So the views of David Halpern, the unit’s director, on how to manage opposition to infrastructure projects deserve to be taken seriously, and his ideas applied more widely.

Mr Halpern has mused that people who live under flight paths might view airport expansion more positively if they were offered free flights to the Caribbean. Equally, those whose homes are subject to compulsory purchase to make way for HS2, or fracking, might be mollified were the government to compensate them more handsomely. Under the current rules, owners are paid the best market price and a home-loss payment of 10% of its value, capped at £47,000. This is not just a poor incentive to make people do something they do not wish to do; it is an unpalatable way for a government to treat its citizens. In a project as vast as HS2, a few million will make little difference and would be cancelled out by reducing the costs associated with delay.

It is true that some of the nudge unit’s reports can be filed under “statements of the blindingly obvious” Few will have been shocked by their report that mobile phones are more likely to be stolen if they are left on tables in bars. However, just because something is obvious, it does not necessarily follow that everyone will notice. Intractable problems call for imaginative solutions.