Understanding human behaviour is quite complex. It would be good if we were all economists and simply said that consumers do things in a rational manner – whatever that is. Chris Mooney, writing in the Washington Post, raises many important issues from a recent psychological study about why we take the actions we do.
When it comes to saving energy, it’s really not all about the money
A recent psychological study has provided suggestive evidence that when people decide to take steps to use less energy at home, and so to protect the environment, they don’t merely do so because they want to save a little bit of cash on their electricity bills. If anything, it suggests, some forms of materialistic or competitive thinking may inhibit deep or long-lasting conservation attitudes.
The study, recently published in Energy Policy and led by Zeynep Gurguc of Imperial College London, was able to show this by studying a pretty perfect test population: postgraduate students in West London, who did not have to pay anything for their energy use in their student residence halls — and, indeed, many of whom were young enough that they had no experience with energy bills at all. Therefore, any change to their at-home energy use behavior could hardly be chalked up to a desire to save a little money.
Eighty-nine of these students were involved in a classic “nudging” experiment, popular in behavioral science and behavioral economics. The students were informed once per week for seven weeks about how much energy they were using in their dorm rooms for electricity and heating, and how that compared with the energy usage of other students, based on numerical rankings.
The goal was not only to convey information about one’s personal energy use (so that it isn’t so murky), but also to invoke a “norm” — the idea that it is good to use less and, indeed, your neighbors are doing precisely that! Thus, students were also given praise on the forms if they were doing well (“Well done! Your rank is improving”), and advice about how to do better (“Don’t forget the kitchen!”).
But there was also a variant on the experiment — some of the students were told not only how they were doing in comparison to other students but also that the student who did the best in the rankings would receive an unspecified prize.
“By being in a student hall, we’re in a setting where the consumers don’t see a direct effect of what they’re consuming on their energy bill,” said Mirabelle Muûls, a researcher with Imperial College London and one of the study’s authors. “And therefore we could focus the incentive that nudging has, and the incentive that a competition with a prize at the end can have, compared to another setting where consumers have a more direct effect of reducing their bill.”
The group was highly international: Only 19 percent of the students in the study came from the U.K., so it is hard to say that the results merely reflect British culture, where there is indeed great concern about addressing climate change.
However, the students also came from families in which parents were likely to have advanced degrees — one limitation of the study, in that it suggests that the group under study is not fully representative of the population at large.
Limitations aside, the study found that simply informing the students about how much energy they were using, and how it compared with what other students were doing, led to a 22 percent decrease in overall usage. And at least part of this effect seems tied to the students’ environmental values.
“In one of the survey questions, they were answering, ‘We care about conservation of our environment,’” added Gurguc, also a researcher with Imperial College London and the lead study author. “This is good that this was a main motivator, rather than money itself, or price itself.”
The prize competition, however, revealed “an intriguing perverse effect,” the study says. While students in this grouping at first also reduced their energy use, they then lapsed after a few weeks and became more like a control group of students who never received any information about energy use at all.
The result was that the study in effect contrasted socially oriented or norm-driven behavior with more competitively driven behavior — and found that the normative approach produced better results for the body of students as a whole in energy consumption.
“Only the student with the lowest energy consumption would win a prize,” the study notes. “Hence, if this becomes the main behavioural driver, there is little incentive to change behaviour if it seems completely out of reach to be the best student at reducing energy consumption and winning the prize.”
That suggests that competitions should be carefully designed, the researchers say, lest they backfire. But the more resonant finding is that even though it wasn’t saving them any money, the students who were informed about their energy usage and how it compared with that of their neighbors (but were not prompted to be overly competitive about it) showed very significant changes.
“Everybody will say they care about the environment if you go on the street and hold a microphone in their face, but here, they had to, basically, put the effort where their mouth is,” said Ralf Martin, another of the study authors from Imperial College London. “They really changed behavior, for some kind of common-good reason. It’s a stronger signal for that.”
Now, the researchers say, a further goal will be to try similar experiments with more diverse groups of people than students, to see if similar findings apply.
“This actually paints a very nice positive aspect of humanity,” Gurguc said. “They are concerned about what others do. . . . Yes, people can care about things other than monetary gain.”