The field of behavioral economics is of strong interest to me because it speaks to blind spots. The blind spot is the most interesting of all things because we have no ability to fix a blind spot, because we are blind.
We all have blind spots, and they come in many different fashions. The first one to discover is your optic nerve blind spot because it is so obvious, and shows what our brain does.
What is the optic nerve blind spot?
Our eye is constructed in a marvelous fashion. If you just simply meditate on the mystery of the eye, it is almost overwhelming. Many ontological arguments about the existence of God has been made about the eye. After all, how could evolution (or the blind watchmaker) ever create an eye? It seems to complicated to arise through a roll of the dice. Yet some atheists declare that the eye is a good example of how God could not have made the eye. The problem is that the human eye is great in almost all aspects except for one big problem: the optic nerve punches a hole out the backside of your eyeball so it can route information into the brain. The evolutionist declare, "A good an perfect God has what looks like hillbilly engineering on the eye. If he went through all the problems of getting himself a fantastic eye, why couldn't he come up with the ability to do a little routing correctly."
You can say that, or you could say, "I wonder what object lesson God planned when he allowed the eye to evolve?"
Full disclosure here. I am a theistic evolutionist. That is I believe in both evolution and God's creation. I believe that God does place dice with the universe, and in some of my other blog postings, I think that I intuitively believe in the many world hypothesis. I believe that for humans to have choice, there must be some randomness in everything that God made. If not, then God simply controls everything. If God controls everything, then we have no free will. And I do believe in Freewill.
The way that the eye works is that your vision should have a black hole in it. The black holes is from where the nerve passes through the back of your eye. However, all of us know that w don't have a black hole in our vision so what is happening? Our brains are wonderful things. The hole in our eye is covered over by our vision center. Yes, there is a black hole. Your brain simply refuses to show it to you. So you see an illusion. The illusion is of a great background, and no blackness.
Cover your left eye and look at the dot on the left in this image. Be aware of the cross on the right, but don't look at it - just keep your eye on the dot. Move your face closer to the monitor, and farther away. At some point, you should see the cross disappear. Stay at that point and close your right eye. Stare at the cross, and you should see that the dot has disappeared. It doesn't just happen with a white background. Try the same with colored paper, and your mind will fill in the background color of the paper when the mark gets in your blind spot.
Our Lord and Master spoke to this:
"Why do you look at the speck of sawdust in your brother's eye and pay no attention to the plank in your own eye?
Now some would say that this could not be the issue at all. Jesus could have not known about the optic blind spot. However, the same principle applies when he says, “Whoever has ears, let them hear." (Matt 11:16.) Jesus knew that they all had ears. What he was saying was “you have ears, but you refuse to hear. Stop being hard of hearing, and listen.” This is a call to all of us.
Our brains have blindspots.
It turns out that the optic nerve is the least of our blind spots. The great secret is that this does not matter in the physical realm because you have two eyes and the blind spot does not overlap with your other eye blind spot. So even though you cannot see the information in the blind spot with the on eye, the other eye can pick it up. In reality, we have a ton of other blind spots, where we do not have coverage. I have written about this before, but this is the basis of behavior economics. It is trying to understand the blind spots that we all have in our brain.
Richard Thaler, and his co-authoer Cass Sunstein, points out a bunch of these blindspots. He also points out that we can actually use these blindspots to make ourselves and our society better. He advocates a couple of ideas that are controversial, which they call "libertarian paternalism." The idea is that our society should allow people to make bad choices if they really want to, but we shouldn't encourage bad choices. It is a little like allowing your kids to operate a chain saw, but make sure that it is locked up, has all the safety guards on it, and takes a little bit of work to get it out. Most of the time, by doing a little bit of this protection work, which they call choice architecture, you can prevent 99% of bad results for both chainsaws and ordinary decisions.
There are two particular areas of interest where they believe that a little nudge would fundamentally change the nature of our society. These areas are the intractable areas of retirement savings and health care. They argue, with good data, that minor changes in how people are presented data will make society many fold better.
Now, I am not going to repeat the nature of the blindspots that he looks at in the book. I am only going to encourage you to read the book. While I would not rank it above Kahneman's "Thinking Fast and Slow," it does have a very strong applications of behavior economics and choice architecture to make our society better.
Now the fundamental problem is where does the overlap between nudging and manipulation come about? I had a rather heated discussion with one of my family members on this recently. At the time I over reacted to the circumstance, but it ended up being a good conversation. In my case, there was a situatino where somebody was embarassing somebody else. Somebody in my family was cooking up a good story to divert somebody from having the situation come up. The problem is that the story was in essence a lie. It was complete misdirection rather than the person facing a truth that might cause a bit of controversy.
However, the person once confronted by me felt very poor about what they were doing, and they were ready to go to the opposite extreme and be overly blunt. This is the trick of the whole thing, and one of the most enlightening things about the book. The whole point of the is to nudge a little bit. You don’t force, and you don’t lie. You nudge.
In reality, we need to do a lot of nudging, but nudging is hard and takes a lot of thought. You can’t just slam somebody hard and manipulate. You can’t just nag them until they relent. On the other hand, you can’t just turn your brain off, and be “totally honest.” Total honesty is just a scam for people to be lazy. Total honesty means that you just don’t want to spend enough time thinking through how to break news to somebody in the best way. I believe that story of Jesus in the New Testament shows that God on earth was a person who life was constantly nudging other to do the right thing.
As an alternative example of trying to nudge correctly, I submit the following story. My youngest son did not want to go golfing this weekend. Yet both my wife and I knew that he really does want to go golfing. He is on the high school golf team, and he really enjoys doing well. It is also the best time of the week for father and son bonding. We have had multiple times were he was in a bad mood before going out and 19 out of 20 times, he is in a good mood by the end of the round and thanks me for taking him out.
My wife’s approach to this situation was to lay down the law on Friday. “You need to go golfing with Dad she declared.” He fired back, “Stop bugging me, I’ve been going hard. I want to relax.” So we are ready for the fight. Instead, I decided to nudge him. Because we had a three day weekend this weekend, I texted him “Hey, do you want to go golfing Sunday or Monday?” Because he was making the choice about something, and yet it was a simple choice (not exhaustive choice, which is subject to decision fatigue), he quickly texted back, “Sunday sounds good.”
This nudging effect is very well known in sales. What I did is called the “Two Option Close” or “The Wheeler Which Close” named after its founder Elmer Wheeler, who was a salesman and had the greatest name ever for a sales person. Long before we had anything called “Behavior Economics,” good sales people knew how to get a positive response from somebody without doing anything fundamentally dishonest. The Wheeler Which was used by Walgreens in it’s heyday in 1930s to dramatically increase store sales. However, this has been used and rediscovered for many centuries before this. It simply relies on our blindspot.
As I age, I believe one of the biggest pieces of insights that you can get that will positively influence your life is to understand the blindspots in yourself and in others. Once you are armed with this knowledge, you can fundamentally change many things because you have a very long lever. You understand why our brains make decisions in particular ways. I believe the most successful people intrinsically use these tools. For those that don’t do it naturally, readying Nudge is a good place to start.