Fourth Industrial Revolution

What is behavioural science, and how is it going to change your life?

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 7, 2016.  REUTERS/Brendan McDermid - RTX2SC8K

Image: REUTERS/Brendan McDermid

Iris Bohnet
Professor of Public Policy, Harvard Kennedy School
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Could behavioural science help to reduce unemployment, or inflation, or prevent another financial crisis? Iris Bohnet, Director of the Women and Public Policy Program at the Harvard Kennedy School of Government and co-chair of the Global Future Council on Behavioural Sciences, says that the discipline is helping to break new ground in multiple areas, from healthcare and education to social inclusion and consumer finance.

Why does behavioural science matter to the Fourth Industrial Revolution?

For equity and inclusion. We want the benefits of the 4IR to be felt by everyone – and the extent to which this happens will be shaped by the cumulative impact of many decisions made by individuals.

Traditionally we’ve had two broad categories of tools to influence how people make decisions. There are “hard” tools, like incentives, regulations and laws. And there are “soft” tools, like education, information and moral appeals.

Behavioural science is providing us with new tools in our collective toolbox to promote behavioural change. They tend to sit in the middle of those hard and soft tools, and they’re often both cheaper and more impactful.

Can you give an example of how a behavioural science tool could help with inclusion in the context of the Fourth Industrial Revolution?

Sometimes big data and machine learning can unwittingly perpetuate bias. So, for example, suppose someone wants to search for a Charlotte on LinkedIn, types “Charl” and it auto-completes to Charles. The machine thinks it’s being helpful, because more people have searched for Charles in the past. But that can be counterproductive if we want to encourage more Charlottes in the future.

Much of my own work concerns human resource management. For example, how do you “de-bias” recruitment, to avoid excluding good candidates from non-traditional backgrounds? It turns out that something as simple as the choice of words in job adverts can put people off applying – words like “supportive” and “competitive” can deter male and female candidates, respectively.

Then there’s evidence showing that the traditional unstructured interview is terrible at predicting actual job performance. There’s a slew of start-ups now using technology to offer companies more effective ways to assess job applicants, rooted in insights from behavioural science – and that’s a recent development, in the last two or three years.

Job seekers break out to visit corporate employment personnel at a U.S. Chamber of Commerce Foundation
Image: REUTERS/Gary Cameron

Where else is behavioural science breaking new ground?

Education is an area where traditional approaches have held sway for a long time – and where increasing effectiveness is widely recognized as key to making the most of the 4IR, as the pace of technological change will lead to rapid shifts in the skills required. Behavioural scientists are looking now at possible ways to help students learn and teachers teach more effectively.

There’s a lot of potential to do more in healthcare – it’s been shown that small things like prompting people to take their medicine at the right time can have a huge impact in improving the efficacy of treatment. I expect we’ll see more behavioural science-inspired innovations in preventative care.

And I expect there’ll be more on consumer finance, where we’ve seen – for example – huge impacts from small tweaks to how credit card bills are presented, making it easier for people to understand the implications of being in debt, and what interest rates really mean.

How might behavioural science potentially help to address mass unemployment and widening inequality as robots and AI displace human jobs?

The honest answer is that nobody knows yet. So far, behavioural science has been most powerful in very well-specified “micro” questions, such as how to increase tax compliance, or voter turnout, or energy conservation. Here there have been very large effects from tiny and cost-free tweaks, like adding a sentence to a tax reminder letter saying “most people have paid already”.

But could behavioural science help with “macro” questions, like how to reduce unemployment, or inflation, or prevent another financial crisis? That’s one of the questions the Global Future Council will be exploring. Among its members is Bob Shiller, the Nobel Laureate, who believes it is realistic for behavioural scientists to be ambitious on these kind of macro questions.

Does behavioural science encounter pushback, and how can it be overcome?

There are two main forms of pushback. Some people worry that “nudging” is paternalistic, which I think is misguided, as it’s an illusion to imagine that there’s a design-free world. For instance, you have to organize the food in the cafeteria somehow – so why not do it thoughtfully, in a way that encourages healthier choices? But behavioural scientists could address this concern more effectively by being more aware of the need for transparency.

The other is legal. If I propose, say, a new way of evaluating job applicants, companies can’t perform a randomized trial by dividing applicants in two groups and treating them differently, as applicants could sue them. That’s a challenge to us as academics to think more creatively: for example, to design ways to run the different evaluation methods in parallel on all the applicants.

Where can you imagine the field of behavioural science being by 2030?

I can imagine that all organizations, big and small, will be employing tools to recruit, assess and manage people that effectively exclude any role for unconscious bias and make sure that people’s talents are fully used – no matter what their background.

The Annual Meeting of the Global Future Councils is taking place on 13-14 November in Dubai.

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Related topics:
Fourth Industrial RevolutionBehavioural SciencesFuture of Work
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