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2016-11-10

Relaxed watchfulness at a rollercoaster ride with nudges

Relaxed watchfulness at a rollercoaster ride with nudges
On the morning of this 9 November 2016, the election of Donald Trump as US president is the foremost topic of conversation also in the Meistersaal in Berlin. „You really make me forget the elections, now. It is wonderful to see you all here in this room“, that is how Professor David Zilberman from the University of California, Berkeley, welcomes the 200 guests. The mahogany brown colored hall is pretty well filled, free seats are hard to find under the high ceiling. The question of the day could not be any more prevailing: Do the citizens really make rational choices or do emotional dynamics predominate?

The American scientists Richard Thaler and Cass Sunstein have a clear opinion on this. Based on behavioral-economic findings they argued in their 2008 book „Nudge: Improving Decisions About Health, Wealth, and Happiness“ that human beings do not act rationally by nature and triggered a fervid debate. Ever since dozens of governments deal with the question how to induce their citizens to make sensible and reasonable decisions.

In 2010 the British government appointed a ‘Behavioural Insights Team’ whose task was to design nudges for the improvement of government politics. President Barack Obama also established a ‘Social and Behavioral Sciences Team’ for this purpose. Therefore it is no wonder that since 2015 also the German federal government increasingly discusses the method of nudging. For this purpose the Federal Chancellery established a special department dealing with the effects of nudging. Also the Ministry of Justice and the Ministry of Agriculture are checking their options for nudging.

That is why the association DIE LEBENSMITTELWIRTSCHAFT has commissioned Professor Peter Kenning from the Heinrich Heine University of Düsseldorf to conduct a study investigating consumers’ opinions towards paternalism to create a first empirical inventory on this topic. The results from the study „That´s for Eats! Orientation versus Paternalism“ are being introduced to the start of the symposium of the same title together with the University of California, Berkeley. The symposium x-rays the topics paternalism and nudging from different perspectives. The program with twelve speakers from the fields of economy, science, politics and media is hosted by moderator Thomas Leif.

In his address of welcome Friedhelm Dornseifer, management board member of DIE LEBENSMITTELWIRTSCHAFT, introduces the topic and highlights the upcoming challenges for the food industry. „In 2050 there will be 9 billion people living on this planet and there will be a need for 60 per cent more food.“ Besides food innovations, also changes in eating habits are necessary. Here, nudging could make a contribution.

In his speech dealing with the rapid transformation of the food industries in the growing markets of Asia, Africa and Latin America Professor Thomas Reardon from the University of Michigan illustrates the upcoming challenges, while also underlining the chances of the urbanization in these regions. „Around 30 to 40 million people live in the metropolitan region of New Delhi and its surroundings alone. That in itself is a growing market with the volume of France in a much smaller area.“

His colleague Professor David Zilberman from the University of California, Berkeley, is calling for a matter-of-fact view on the concept of nudging. It is a neutral and limited instrument that can be used in a sensible way. „However, you cannot force people to change, you need to respect their freedom of choice.“

Investigating the question „Is nudging harmless?“ the journalist Alexander Neubacher from the Spiegel magazine is giving an intentionally critical and polarizing speech. „The conception of man underlying nudging – the idea of man being underage and acting irrationally – worries me deeply.“ This speech triggers a fervid debate on Twitter under the hashtag #LMWnudge.

In contrast to this the former federal judge Wolfgang Neskovic cautions about premature alarmism and delivers a legal perspective on the topic. The constitution protects the citizens from unjustified interventions in their freedom of decision. „Interventions are constitutionally legitimate only if they are predicated on legal grounds.“ This is also held true for nudging which so far has rarely appeared as political instrument. Therefore there is a demand for „relaxed watchfulness“.

For Professor Sean B. Cash from the Tufts University nudges are one of many instruments of political intervention that can be used in case of market failure.

The perspective of the Federal Government delivers the Parliamentary State Secretary in the Ministry of Food and Agriculture Dr. Maria Flachsbart. „Why shoudn´t we use nudging in principal?“, she is asking and underlines the common welfare aspect of the health of the individual citizen. But whether you consume cola and chips lying on your couch in the evening, that is the free and private decision of each individual, she adds.

Subsequently Professor Peter Kenning presents the results of the study „That´s for Eats! Orientation versus Paternalism“. The study shows that around 77 per cent of German consumers reject that the state decides over their head what is healthy or not. Around 80 per cent make a point of making a self-determined decision when buying foods. Consumers want to be informed, but a soon as the extent of the interventions deepen, also the perception of paternalism increases to 40 to 60 per cent.

The European perspective delivers Professor Lucia Reisch from the Copenhagen Business School. „Nudging is an instrument, which is per se neither positive nor negative.“ It is capable of supporting people wherever they need and demand it.  In her speech she introduces and describes several projects of the European Union on the subject of nudging.

A refreshing practical input is brought in by Andreas Bohner and Jürgen Sieg from the company „Rettenmaier & Söhne“. In their speech about innovative food products they give an insight in the future of individually designed foods. Giving practical examples they explain how the challenge of growing global demand for food can be handled.

In his concluding speech Professor Justus Wesseler from the University Wageningen emphasizes that deliberate nudging can be absolutely reasonable and helpful. „It is pivotal that you define the goals of nudging clearly and execute a matter-of-fact cost-benefit analysis.“

„We went through a superb rollercoaster ride through the topic of nudging and discovered new issues all the time through“, Stephan Becker-Sonnenschein, Managing director of the association DIE LEBENSMITTELWIRTSCHAFT, sums up the symposium. It is necessary to perform much more research on this topic.

In April 2017 the University of California, Berkeley, will host the next joint food symposium in Berkeley in the context of the international „Executive Program“.

You may access interviews with each speaker on the topic and further videos from the symposium here.