Article | Published:

Nudging out support for a carbon tax

Abstract

A carbon tax is widely accepted as the most effective policy for curbing carbon emissions but is controversial because it imposes costs on consumers. An alternative, ‘nudge,’ approach promises smaller benefits but with much lower costs. However, nudges aimed at reducing carbon emissions could have a pernicious indirect effect if they offer the promise of a ‘quick fix’ and thereby undermine support for policies of greater impact. Across six experiments, including one conducted with individuals involved in policymaking, we show that introducing a green energy default nudge diminishes support for a carbon tax. We propose that nudges decrease support for substantive policies by providing false hope that problems can be tackled without imposing considerable costs. Consistent with this account, we show that by minimizing the perceived economic cost of the tax and disclosing the small impact of the nudge, eliminates crowding-out without diminishing support for the nudge.

Access optionsAccess options

Rent or Buy article

Get time limited or full article access on ReadCube.

from$8.99

All prices are NET prices.

Data availability

The raw data from all our experiments and statistical code for all analyses and figures reported in the paper and the supplementary information are available via the Open Science Framework at: https://osf.io/w4u5q/.

Additional information

Journal peer review information: Nature Climate Change thanks M. Galizzi, A. Maki and S. Werfel for their contribution to the peer review of this work.

Publisher’s note: Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

References

  1. 1.

    Allcott, H. Social norms and energy conservation. J. Public Econ. 95, 1082–1095 (2011).

  2. 2.

    Hedlin, S. & Sunstein, C. Does active choosing promote green energy use? Experimental evidence. Ecol. Law Q. 43, 107–141 (2016).

  3. 3.

    Benartzi, S. et al. Should governments invest more in nudging? Psychol. Sci. 28, 1041–1055 (2017).

  4. 4.

    Camerer, C., Issacharoff, S., Loewenstein, G., O’Donoghue, T. & Rabin, M. Regulation for conservatives: behavioral economics and the case for ‘asymmetric paternalism’. Univ. Pa. Law Rev. 151, 1211–1254 (2003).

  5. 5.

    Hall, M. G. et al. Public support for pictorial warnings on cigarette packs: an experimental study of US smokers. J. Behav. Med. 41, 398–405 (2018).

  6. 6.

    Thaler, R. H. & Sunstein, C. R. Libertarian paternalism. Am. Econ. Rev. 93, 175–179 (2003).

  7. 7.

    Thaler, R. H. & Sunstein, C. R. Nudge: Improving Decisions about Health, Wealth, and Happiness (Yale Univ. Press, 2008).

  8. 8.

    Allcott, H. & Rogers, T. The short-run and long-run effects of behavioral interventions: experimental evidence from energy conservation. Am. Econ. Rev. 104, 3003–3037 (2014).

  9. 9.

    Yoeli, E. et al. Behavioral science tools to strengthen energy & environmental policy. Behav. Sci. Policy 3, 68–79 (2017).

  10. 10.

    Loewenstein, G. & Chater, N. Putting nudges in perspective. Behav. Public Policy 1, 26–53 (2017).

  11. 11.

    Marteau, T. M., Ogilvie, D., Roland, M., Suhrcke, M. & Kelly, M. P. Judging nudging: can nudging improve population health? BMJ 342, d228–d228 (2011).

  12. 12.

    Levitt, S. D., List, J. A., Neckermann, S. & Sadoff, S. The behavioralist goes to school: leveraging behavioral economics to improve educational performance. Am. Econ. J. Econ. Policy 8, 183–219 (2016).

  13. 13.

    Madrian, B. C. et al. Behaviorally informed policies for household financial decisionmaking. Behav. Sci. Policy 3, 26–40 (2017).

  14. 14.

    Thaler, R. H. & Benartzi, S. Save more tomorrow: using behavioral economics to increase employee saving. J. Polit. Econ. 112, S164–S187 (2004).

  15. 15.

    Rogers, T. & Feller, A. Reducing student absences at scale by targeting parents' misbeliefs. Nat. Hum. Behav. 12, 335–342 (2018).

  16. 16.

    Nash, N. et al. Climate-relevant behavioral spillover and the potential contribution of social practice theory. WIREs Clim. Change 8, e481 (2017).

  17. 17.

    Thøgersen, J. Spillover processes in the development of a sustainable consumption pattern. J. Econ. Psychol. 20, 53–81 (1999).

  18. 18.

    Truelove, H. B., Carrico, A. R., Weber, E. U., Raimi, K. T. & Vandenbergh, M. P. Positive and negative spillover of pro-environmental behavior: an integrative review and theoretical framework. Glob. Environ. Change 29, 127–138 (2014).

  19. 19.

    Meijers, M. H. C., Verlegh, P. W. J., Noordewier, M. K. & Smit, E. G. The dark side of donating: how donating may license environmentally unfriendly behavior. Soc. Influ. 10, 250–263 (2015).

  20. 20.

    Tiefenbeck, V., Staake, T., Roth, K. & Sachs, O. For better or for worse? Empirical evidence of moral licensing in a behavioral energy conservation campaign. Energy Policy 57, 160–171 (2013).

  21. 21.

    Werfel, S. H. Household behaviour crowds out support for climate change policy when sufficient progress is perceived. Nat. Clim. Change 7, 512–515 (2017).

  22. 22.

    Fishbach, A., Dhar, R. & Zhang, Y. Subgoals as substitutes or complements: the role of goal accessibility. J. Pers. Soc. Psychol. 91, 232–242 (2006).

  23. 23.

    Loewenstein, G. & Ubel, P. Economics behaving badly. The New York Times A31 (15 July 2010).

  24. 24.

    Loewenstein, G. et al. A behavioral blueprint for improving health care policy. Behav. Sci. Policy 3, 53–66 (2017).

  25. 25.

    Sunstein, C. R. Do people like nudges? SSRN https://doi.org/10.2139/ssrn.2604084 (2016).

  26. 26.

    Interagency Working Group on Social Cost of Greenhouse Gases. Technical Update on the Social Cost of Carbon for Regulatory Impact Analysis—Under Executive Order 12866 (Office of Management and Budget, 2013).

  27. 27.

    Weber, E. in Psychological Perspectives to Environmental and Ethical Issues in Management (eds Bazerman, M., Messick, D., Tensbrunsel, A. & Wade-Benzoni, K.) 314–341 (Jossey-Bass, 1997).

  28. 28.

    Hansen, J., Marx, S. & Weber, E. The Role of Climate Change Perceptions, Expectations, and Forecasts in Farmer Decision Making: The Argentine Pampas and South Florida (International Research Institute for Climate Prediction, 2004).

  29. 29.

    Campbell, T. H. & Kay, A. C. Solution aversion: on the relation between ideology and motivated disbelief. J. Pers. Soc. Psychol. 107, 809–824 (2014).

  30. 30.

    Tannenbaum, D., Fox, C. R. & Rogers, T. On the misplaced politics of behavioural policy interventions. Nat. Hum. Behav. 1, 0130 (2017).

  31. 31.

    Davidai, S. & Shafir, E. Are ‘nudges’ getting a fair shot? Joint versus separate evaluation. Behav. Public Policy https://doi.org/10.1017/bpp.2018.9 (2018).

  32. 32.

    Reisch, L. A. & Sunstein, C. R. Do Europeans like nudges? SSRN Electron. J. 11, 310–325 (2016).

  33. 33.

    Dolan, P. & Galizzi, M. M. Like ripples on a pond: behavioral spillovers and their implications for research and policy. J. Econ. Psychol. 47, 1–16 (2015).

Download references

Acknowledgements

We thank R. Thaler and C. Sunstein for helpful comments and discussions. D.H. is grateful for funding from the Swiss National Science Foundation’s Doc.Mobility fellowship.

Author information

All authors contributed equally to the development of the ideas and authoring of the paper. D.H. implemented the surveys and managed the data collection. E.H. performed the statistical analyses and D.H. assisted.

Competing interests

The authors declare no competing interests.

Correspondence to David Hagmann.

Supplementary information

Supplementary Information

Supplementary Tables 1–12, Supplementary Notes 1–7, Supplementary Figures 1–9, Supplementary References and Supplementary Methods.

Reporting Summary

Rights and permissions

Reprints and Permissions

About this article

Verify currency and authenticity via CrossMark

Further reading

Fig. 1: Introducing a green energy nudge reduces support for a carbon tax.
Fig. 2: Support for a carbon tax in the presence of a related or unrelated nudge in Study 2.
Fig. 3: Effect of nudge option on tax support across policy domains in Study 3.
Fig. 4: Support for carbon tax and green energy nudge in Study 4.