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Literature Summary Nudge influencing Behavior
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Summary of all the literature for the course nudge: influencing behavior. The book isn't included here.
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Nudge: Influencing BehaviourUnskilled and unaware of it: How difficulties in recognizing one’s own
incompetence lead to inflated self-assessments – J. Kruger & D. Dunning (1999)
- In many domains in life, success and satisfaction depend on knowledge, wisdom, or savvy in
knowing which rules to follow and which strategies to pursue.
- People differ widely in the knowledge and strategies they apply in these domains, with
varying levels of success.
- When people are incompetent in the strategies they adopt to achieve success and
satisfaction, they suffer a dual burden: not only do they reach erroneous conclusions and
make unfortunate choices, but their incompetence robs them of their ability to realize it.
Instead, they are left with the mistaken impression that they are doing just fine.
We argue that the skills that engender competence in a particular domain are often the very same
skills necessary to evaluate competence in that domain. Because of this, incompetent individuals lack
metacognition, metamemory, metacomprehension, or self-monitoring skills. These terms refer to the
ability to know how well one is performing, when one is likely to be accurate in judgment, and when
one is likely to be in error.
Imperfect self-assessments
We focus on the metacognitive skills of the incompetent to explain, in part, the fact that people seem
to be so imperfect in appraising themselves and their abilities.
Above-average effect: the tendency of the average person to believe he or she is above average, a
result that defies the logic of descriptive statistics.
We belief focusing on the metacognitive deficits of the unskilled may help explain this overall
tendency toward inflated self-appraisals. Because people usually choose what they think is the most
reasonable and optimal option, the failure to recognize that one has performed poorly will instead
leave one to assume that one has performed well. As a result, the incompetent will tend to grossly
overestimate their skills and abilities.
Competence and metacognitive skills
Unaccomplished individuals do not possess the degree of metacognitive skills necessary for accurate
self-assessment that their more accomplished counterparts possess.
However, not examined whether metacognitive deficiencies translate into inflated self-assessments
or whether the relatively incompetent are systematically more miscalibrated about their ability than
are the competent.
Predictions
Prediction 1: Incompetent individuals, compared with their more competent peers, will
dramatically overestimate their ability and performance relative to objective criteria.
Prediction 2: Incompetent individuals will suffer from deficient metacognitive skills, in that
they will be less able than their more competent peers to recognize competence when they see it –
be it their own or anyone else’s.
Prediction 3: Incompetent individuals will be less able than their more competent peers to
gain insight into their true level of performance by means of social comparison information. In
particular, because of their difficulty recognizing competence in others, incompetent individuals will
be unable to use information about the choices and performances of others to form more accurate
impressions of their own ability.
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, Prediction 4: The incompetent can gain insight about their shortcomings, but this comes
(paradoxically) by making them more competent, thus providing them the metacognitive skills
necessary to be able to realize that they have performed poorly.
The studies
In each study we presented participants with tests that assessed their ability in a domain in which
knowledge, wisdom, or savvy was crucial.
Study 1: Humor
Study 2 & 4: Logical reasoning
Study 3: English grammar
We then asked participants to asses their ability and test performance.
In all studies, we predicted that participants in general would overestimate their ability and
performance relative to objective criteria. But we predicted more to the point that those who proved
to be incompetent would be unaware that they had performed poorly.
In addition, we wanted to examine the relationship between miscalibrated views of ability
and metacognitive skills, which we operationalized as (a) the ability to distinguish what one has
answered correctly from what one has answered incorrectly and (b) the ability to recognize
competence in others.
Study 1: Humor
A series of jokes, participants had to rank the humor of each one. Then compared it to the ratings of
an expert panel.
Two effects revealed:
1. Although perceptions of ability were modestly correlated with actual ability, people tended
to overestimate their ability relative to their peers.
2. Those who performed particularly poorly relative to their peers were utterly unaware of this
fact.
Study 3 (Phase 1): Grammar
Participants were asked to compete a test assessing their knowledge of American Standard Written
English (ASWE). Also asked to rate their overall ability to recognize correct grammar, how their test
performance compared with that of their peers, and finally how many items they had answered
correctly on the test.
Study 3 (Phase 2): It takes one to know one
People who lack the knowledge of wisdom to perform well are often unaware of this fact. We
attribute this lack of awareness to a deficit in metacognitive skill. That is, the same incompetence
that leads them to make wrong choices also deprives them of the savvy necessary to recognize
competence, be it their own or anyone else’s.
Phase 2: couple weeks after the first phase, the bottom and top quartile performers were invited
back. Give each group the tests of 5 peers to grade and asked them to assess how competent each
target had been in completing the test.
After that, reassess themselves.
False-consensus effect: participants assumed that because they performed so well, their peers must
have performed well likewise. This leads top-quartile participants to underestimate their
comparative abilities, but not their absolute abilities.
Study 4: Competence begets calibration
We have shown that incompetent individuals are unaware of their deficient abilities and show
deficient metacognitive skills.
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, Give participants a test of logic based on the Wason selection task and asked them to assess
themselves in a manner similar to that in the previous studies. Then gave half of the participants a
short training session designed to improve their logical reasoning skills. Finally, we tested the
metacognitive skills of all participants by asking them to indicate which items they had answered
correctly and which incorrectly and to rate their ability and test performance once more.
“He who knows best best knows how little he knows”. Participants scoring in the bottom
quartile on a test of logic grossly overestimated their test performance – but became significantly
more calibrated after their logical reasoning skills were improved.
General discussion
Incompetence not only causes poor performance, but also the inability to recognize that one’s
performance is poor.
Across the four studies, participants in the bottom quartile not only overestimated
themselves, but thought they were above-average.
Paradox: one way to make people recognize their incompetence is to make them competent.
The burden of expertise
Extremely competent individuals suffer a burden as well. Although they perform competently, they
fail to realize that their proficiency is not necessarily shared by their peers.
Nudge your customers toward better choices – D. Goldstein, E. Johnson, A.
Hermann & M. Heitmann (2008)
Knowing the merits and limitations of defaults can help firms better serve a variety of customers –
those who wish to make active decisions, those who prefer to rely on the expertise of the company
to guide them, and those who don’t want to be bothered making choices at all.
A field guide to defaults
Setting default is complex. Because of their powerful effect on customer behaviour, default policies
ought to be examined at the highest levels in the organization.
At a basic level, defaults can serve as manufacturer recommendations, and more often than
not we’re happy with what we get by accepting them.
Given the power of defaults to influence decisions and behaviour both positively and
negatively, organizations must consider ethics and strategy in equal measure in designing them.
Two categories of defaults:
- Mass
- Personalized
Mass defaults
Mass defaults apply to all customers of a product or service, without taking customers’ individual
characteristics or preferences into account. Mass defaults by their very nature give some customers a
version of the offering that wouldn’t be their first choice. Still they are very useful when the majority
of customers can reliably be expected to prefer one basic configuration or to benefit from the seller’s
recommendations. In cases where the seller lacks information about customers’ profiles or
preferences, mass defaults may be a company’s only option.
Benign defaults: represent a company’s best guess about which product or service
configurations would be most acceptable to most customers, and would post the least risk to the
firm and the customers.
When no default is your best option
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