A Field Experiment on Pro-Social Nudges: The Snowballing Problem

Abstract

In contrast to traditional economic methods to address negative externalities, the study of pro-social nudges within the field of behavioral economics is quickly developing (Carlsson et al., 2019, 2021; Schubert, 2017). The aim of pro-social nudges is to reduce a negative externality to a defined group or community. This study uses a natural field experiment to examine the impact of a pro-social nudge on a local negative externality of hot rooms in college residence buildings and the resulting more global externality of excess greenhouse gas emissions. These externalities are the result of the interplay between the heating system and the propensity of students to open their windows causing the system to produce more heat to everyone––labeled the snowballing problem. This study suggests the nudge did not reduce the negative externalities, rather it may have backfired and exacerbated the existing problem (room temperatures increased 0.5–1.6 F° after the intervention). As the results illustrate, addressing negative externalities with pro-social nudges may be particularly challenging because they often target behavior that benefits a larger society and requires the individual to experience some short-term disutility.

Keywords

pro-social nudge behavioral economics natural field experiment

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