June 8, 2010
GreenHomeNYC board member Alison Novak reflects on behavior and green buildings.
Recently I’ve been hearing too much of the same depressing argument: we can’t solve climate change through technology alone but the masses of consumers won’t alter their behavior until there is a direct economic cost to them, such as vastly higher fuel costs. Then I was fortunate enough to attend the latest of the Garrison Institute’s “Climate, Buildings and Behavior” conferences (a GreenHomeNYC Partner-in-Practice was also in attendance, Miquela Craytor, representing Sustainable South Bronx). Re-examining the tenets of neoclassical economics in light of data provided to us by behavioral economics and neuroeconomics, gave me a glimpse of an alternate way of looking at the problem of getting people to change how they live without waiting for dire circumstances.
Behavioral economists and neuroeconomists theorize that humans are others-regarding (care about others) not merely self-regarding (want the most for oneself). We have an affinity for others developed through culture, which is reinforced by our opioid neural system. This is the system that produces oxytocin and calms us.
Let’s take a quick look at two studies from each discipline that suggest there may well be in-roads to major societal change that doesn’t rely on money alone. Can we appeal to an innate sense of fairness and affinity for others to stimulate meaningful behavioral change? What does this mean for how we try to convince naysayers that we need to act now on climate change? Have we been doing this all along but unsuccessfully? Why?
1) Behavioral: The Dictator Game. In this experiment, there are two subjects. Subject A is given $10. Subject B is given nothing. Subject A is given full authority to decide how much money, if any, to share with Subject B. Subject B can only accept or reject the offer. Under neoclassical economics, we would expect that Subject A would wish to maximize her own welfare and keep all $10. The results of the experiment, which has been repeated by numerous researchers and tested cross-culturally, show that most often Subject A offers some amount to Subject B. But wait, it gets even more interesting: depending on the amount offered, Subject B sometimes refuses the offer.
According to neoclassical economics, Subject B should always take the amount offered whether $1 or $10, because it always makes him better off. So what have the many Subject Bs said when refusing the offer? It isn’t fair.
Subject B has more going on in his mind than dollars and cents economics. The studies show that the “fair” amount differs by culture but that each one uses the concept. Remember, Subject B isn’t selling or buying anything, he’s just sitting there on the couch waiting for someone to give him $0-$10. Refusing $1 isn’t economically rational, or is it?
2) Neuroeconcomics: The Trust Game. In this experiment, developed by researcher Tania Singer, subjects take a nasal spray containing oxytocin. Oxytocin reduces activation of the amygdala, the fear center of the brain. Subjects demonstrate greater trust of fellow players in subsequent games. This research suggests that our emotions are hardwired into our brains—trust, fairness, caring for others. These emotions make sense in the context of evolution: the people who can get along together, sharing the fire’s glow and the last tasty morsel of food, will be around long enough to beget a new generation–and teach them to do the same. Emotions are rational and part of economic decision-making.
Another researcher to watch: Shahzeen Attari. She has been looking at things like: when do people prefer to voluntarily change, versus have soft legislation (taxes) or hard legislation (ban). She’s also investigated how accurately people (from environmentalists to naysayers) predict various energy saving actions. Attari is currently a post-doc at CRED, Center for Research on Environmental Decisions.
More reading –