Some fifty years ago in Arkansas, nine black students initiated a social experiment with help from family, friends, and armed National Guards. Their successful attempt to desegregate Little Rock’s Central High School following the decision inBrown v. Board of Educationis among the most momentous events in America’s history, leaving no doubt about its historic importance and the significance of its impact on public policy. Nevertheless, as many have noted, even at the beginning of the twenty-first century, a blatant de facto segregation in living and learning persists and in some circumstances has intensified (e.g., Orfield, 2001). The American...

TheBrown v. Board of Educationdecision in 1954 and the Civil Rights Act of 1964 were monumental policy decisions that changed the landscape of race relations in the United States. Before the implementation of these policies, ethnic minorities and Whites had very little contact with one another, primarily because ethnic minorities were not allowed to be in the same settings with Whites, including attending the same schools, working in the same place of employment, living in the same neighborhoods, and even riding in the same sections of buses and eating in the same sections of restaurants. When contact between...

More than forty years after Congress passed Title VII of the Civil Rights Act of 1964, economists and legal scholars still debate whether this statute and similar others are effective and efficient tools for reducing discrimination in U.S. labor markets. Informed by principles and perspectives from neoclassical economics, some argue that all such regulation is inefficient, even counterproductive, and that markets and marketlike instruments can more effectively eliminate discrimination (Cooter, 1994; Epstein, 1995; Posner, 1987, 1989). Opposing this view, other scholars argue that market forces alone cannot eliminate all forms of discrimination from the labor market, and that at least...

Across the social sciences there has been widespread recognition that it is important to understand how to motivate cooperation on the part of the people within group settings (Tyler, in press-b). This is the case irrespective of whether those settings are small groups, organizations, communities, or societies. Studies in management show that work organizations benefit when their members actively work for company success. Within law, research shows that crime and problems of community disorder are difficult to solve without the active involvement of community residents. Political scientists recognize the importance of public involvement in building both viable communities and strong...

In political science and economics, voting is traditionally conceived as a quasi-rational decision made by self-interested individuals. In these models citizens are seen as weighing the anticipated trouble they must go through in order to cast their votes, against the likelihood that their vote will improve the outcome of an election times the magnitude of that improvement. Of course, these models are problematic because the likelihood of casting the deciding vote is often hopelessly small. In a typical state or national election, a person faces a higher probability of being struck by a car on the way to his or...

Public policy generally results from discussions and negotiation between parties who disagree—discussions and negotiations that can either exacerbate or attenuate ill will. This chapter explores some of the processes that add hostility and distrust to policy disagreements, sentiments that make conflicts between antagonists more difficult to resolve. But other barriers make their influence felt as well (Mnookin and Ross, 1995). Deception, intransigence, and other tactics often impede the achievement of efficient agreements; political considerations and agency problems can also play a role. The barriers to be discussed in detail here, however, are ones that arise frompsychologicalprocesses and...

The twentieth century is often said to have been the bloodiest century in recorded history. In addition to its wars, it witnessed many grave and widespread human rights abuses. But what stands out in historical accounts of those abuses, perhaps even more than the cruelty of their perpetration, is the inaction of bystanders. Why do people and their governments repeatedly fail to react to genocide and other mass-scale human rights violations?

There is no simple answer to this question. It is not because people are insensitive to the suffering of their fellow human beings—witness the extraordinary efforts an individual...

Anthony Capozzi was completely exonerated in 2007 from his earlier rape convictions, just one of nineteen wrongfully convicted persons exonerated of their crimes in that year alone through work of the Innocence Project. At the trial in 1987, the victims positively identified the Buffalo New York man as their attacker, and Capozzi, convicted of two rapes, spent the next twenty years in prison. Postconviction DNA testing of evidence that had been collected from the victims back in 1985 and saved in a hospital drawer proved that the real rapist, a man currently awaiting trial for murder, had committed the crimes...

False convictions have received a lot of attention in recent years. Two-hundred and forty-one prisoners have been released after DNA testing has proved their innocence, and hundreds of others have been released without DNA evidence. We now know quite a bit more about false convictions than we did thirty years ago—but there is much more that we do not know, and may never know.

Conceptually, convicting an innocent person is a misclassification, an error caused by the difficulty of evaluating uncertain evidence about a past event. Few misclassifications, however, are as troubling. A false conviction may destroy the life...

How should policy makers approach the complex issues that arise when a society attempts to minimize the “negative” behaviors of its citizens? Generally, some behaviors are deemed so harmful to society that they warrant a sanctioning response from societal agents. In the absence of official sanctions, the individuals who are harmed might attempt to administer idiosyncratic forms of justice, so any society must tackle the question of how to deal with such actions. Two significant questions arise: First, what sort of control system will capture citizens’ shared moral perspective on which acts should be punished and how harshly? Second, given...

Objectivity is hard to find. Everyday experience is rife with examples of those around us who seem to lack it completely. We see people self-servingly take credit for collective efforts, we see them defend opinions that are biased by prejudice, and we see them allow personal self-interest to influence their desires for the “greater good.” People, it seems, are susceptible to a host of biases that contaminate their perception and judgments. What is perhaps most surprising, though, is not that people are so biased but that they are so inclined to claim that they are objective. Recent years have brought...

Many of our decisions are shaped by government policies that reflect policy makers’ beliefs about our competence to make those choices. For example, policies establishing disclosure requirements for investments and pharmaceuticals reflect beliefs about our competence to recruit and comprehend the relevant evidence. Policies regulating the claims made about consumer products and political candidates reflect beliefs about our competence to evaluate them. Policies governing living wills reflect beliefs about our competence to anticipate personally unprecedented circumstances.

The stakes riding on these beliefs are high. If our competence is overestimated, then we may be denied needed protections. If our competence is...

Many people have argued for cost-benefit analysis on economic grounds. In their view, a primary goal of regulation is to promote economic efficiency, and cost-benefit analysis is admirably well suited to that goal. Arguments of this kind have been met with sharp criticism from those who reject the efficiency criterion or who believe that in practice, cost-benefit analysis is likely to produce a kind of regulatory paralysis (“paralysis by analysis”) or to represent a bow in the direction of well-organized private groups.

In this chapter, I offer support for cost-benefit analysis not from the standpoint of conventional economics, but on...

On March 28, 1979, the Unit 2 nuclear power plant on the Three Mile Island Nuclear Generating Station in Dauphin County, Pennsylvania, suffered a core meltdown. In the investigation that followed, it became clear that a valve that was supposed to regulate the flow of cooling water had failed. The operators sent a control signal to remotely shut the valve, and when they received an indication that the signal had been sent, they assumed that the valve was indeed shut. An actual “positive feedback” lamp indicating the true position of the valve did not exist, so the operator had no...

The employment relationship is often one of life’s most important relationships. In both the United States and other countries, this relationship is subject to a wide range of legal requirements. Some of these legal rules regulate the formation and conduct of labor unions, while other rules govern employer-employee relationships regardless of employees’ union status. The present essay discusses some of the central ways in which the second set of rules—often referred to in the United States as “employment law”—may be analyzed using behavioral economics. Because both the effects and the normative desirability of employment law turn in significant...

Policy thinking about poverty typically falls into two camps. Social scientists as well as regular folk regard the behaviors of the economically disadvantaged either as calculated adaptations to prevailing circumstances or as emanating from a unique “culture of poverty” that is rife with deviant values. The first view presumes that people are highly rational, that they hold coherent, well-informed, and justified beliefs and that they pursue their goals effectively with little error and with no need for help. The second perspective attributes to the poor a variety of psychological and attitudinal shortcomings—failings that render their views often misguided, their...

How can we change people’s behavior, change it deliberately, with a specific goal in mind? This is a central question for social scientists and policy makers who seek to ameliorate societal problems, for, of course, human behavior is at the heart of many of these problems. If people would just stop driving SUVs, keeping their houses so warm, tossing recyclables into the trash, and leaving lights and appliances on, carbon emissions would fall substantially. If they would watch what they eat, do their 30 minutes of exercise each day, wear sunscreen, buckle up, and drink in moderation, they would have...

Each day, environmental factors such as the visibility, size, and accessibility of food contribute to an evergrowing obesity problem in developed countries. Understanding these drivers of consumption volume has immediate implications for nutrition education and consumer welfare. Yet simply knowing the relationship between environmental factors and consumption will not eliminate its biasing effects on consumers. People are often surprised at how much they consume, and that revelation indicates they may be influenced at a basic or perceptual level of which they are not aware (cf. Langer, 1990; Ross and Nisbett, 1991).

This relates to one of the ironies of consumption...

The causes of academic underperformance are a major concern of the educational community and policy makers in the United States. Of particular importance is the achievement gap between at-risk minority students and European American students and its potential remedies. Academically at-risk minority students, such as African Americans and Latino Americans, perform almost a standard deviation below European American students on intelligence tests and earn school grades below those of their European American peers (Jencks and Phillips, 1998; Nisbett, 2009). Between the years 2004 and 2007, while 6 out of every 100 European American young adults had not received a high...

A married couple in their mid-40s with two young children ask their financial advisor whether they should increase the percentage of their assets placed into high-yield stocks. A seventeen-year-old high school student meets with her guidance counselor for advice on where to apply to college. A sixty-five-year-old man with a nonmetastatic prostate cancer asks his physician whether he should have his prostate surgically removed.

Each of these people is facing what is known as apreference sensitive decision, where the right choice depends in part on that person’s specific preferences (O’Connor et al., 1999). The best investment choice, for instance,...

Many of the most important problems currently facing the United States as well as other developed nations stem from arguably irrational behaviors on the part of individuals. For example, many of the health problems plaguing the United States, such as lung cancer, high blood pressure, and diabetes, are so-called lifestyle diseases that are exacerbated by unhealthy behaviors (Schroeder, 2007). Modifiable behaviors such as tobacco use, obesity-related behaviors, and alcohol abuse account for nearly one-third of all deaths in the United States, which only spends 2%–3% of the $2.1 trillion spent on health each year on prevention (Flegal et al.,...

Policy makers from local to supranational levels are being asked to address behavior that impacts economic and social outcomes on multiple scales and, increasingly, also environmental outcomes. Attempts to reduce a country’s dependence on foreign oil, for example, may generate multiple options that all satisfy this policy goal but can have varying impacts on the economic viability as well as on air quality and carbon dioxide emissions. Custodians of the water available in a system of reservoirs need to regulate release times and levels in a way that satisfies stakeholders with different needs and sources of power, while safeguarding future...

In May 2008 a storm surge triggered by Cyclone Nargis swept through low-lying coastal areas of Myanmar without warning, killing an estimated 138,000 residents (Fritz et al., 2009). As staggering as this loss of life was, it was dwarfed by the estimated 230,000 who had died four years earlier in eleven countries in Southeast Asia from a major earthquake and accompanying tsunami (http://www.tsunami2004.net). Even wealthy countries that have the resources to invest in risk-reducing (i.e., mitigation) measures and warning systems have recently witnessed significant losses from natural hazards, such as the $150 billion in total economic damages and 1,300 deaths...

Imagine that it is the December after a presidential election in the United States. The president-elect is interviewing to fill cabinet positions. One potential appointee makes an offer that seems too good to refuse: “Appoint me and I will let you in on a secret policysetting strategy that has been shown to increase savings rates, save lives by improving voluntary efforts, and change how people manage risk.” Even better, the potential appointee adds, “It costs very little and works even if people do nothing. In fact, itdependsupon people doing nothing.” What is the secret strategy? The proper setting...

Consider the following hypothetical example:

The director of food services for a large city school system runs a series of experiments that manipulate the way in which the food is displayed in cafeterias. Not surprisingly, she finds that what the children eat depends on such things as the order of the items. Foods displayed at the beginning or end of the line are more likely to be eaten than items in the middle, and foods at eye level are more likely to be consumed than those in less salient locations. The question is, What use should the director make of...

Policy makers typically approach human behavior from the perspective of therational agentmodel, which relies on normative, a priori analyses. The model assumes people make insightful, well-planned, highly controlled, and calculated decisions guided by considerations of personal utility. This perspective is promoted in the social sciences and in professional schools and has come to dominate much of the formulation and conduct of policy. An alternative view, developed mostly through empirical behavioral research, and the one we will articulate here, provides a substantially different perspective on individual behavior and its policy and regulatory implications. According to the empirical perspective, behavior...

As this volume amply demonstrates, insights from psychology can and do inform multiple spheres of public policy. From labor law to food and nutrition policy to criminal justice procedures, the role and design of policy, as well as its ultimate effectiveness, depend on how the targeted or affected individuals behave. By offering a scientific, empirically based way of better understanding how humans think, decide, and act, psychological research holds great potential for improving the analysis and design of public policy.

Nowhere is this more true than for economic policy. Already, psychology, under the rubric of behavioral economics, has demonstrated a...

Behavioral decision science is gaining traction and becoming a booming field. One sign of success was the award of the 2002 Nobel Prize in economics to Daniel Kahneman for work on the psychological factors that drive human decision making. Further evidence is shown by multiple best-selling books along related lines, includingBlink, by Malcolm Gladwell andFreakonomics, by Stephen Dubner and Steven Levitt. Perhaps a more indirect contributor has been the contemporaneous failure of the Human Genome Project to contribute useful therapies for health care. At a root level, furthermore, behavioral decision science rests on an uncontestable medical foundation; namely,...

Knowledge of the judgment and decision-making (JDM) biases discussed in this book can be applied to the behavior of citizens, consumers, organizations, and policy makers. Many of the essays inform policy makers about how to use this knowledge either to mitigate the biases of individuals and organizations (e.g., to prevent discriminatory behavior) or to manipulate inevitable biases so that people act in their own or society’s best interests (e.g., make appropriate investments for their own futures or protect the environment).

My discussion will focus specifically on the behavior of the policy makers themselves, with the aim of mitigating biases and...

The creature who has come to be known as homo economicus differs from living, breathing human beings in two central ways. First, homo economicus is fully rational: he always employs means that maximize the fulfillment of his ends and does what is in his best interests.¹ Human beings are often not rational; as a result of cognitive errors and biases, emotional reactions, and volitional weaknesses, they often fail to act in their own best interests. Behavioral economists and psychologists in this book and elsewhere have greatly increased our understanding of how human beings fall short in these respects and what...