Margaret McConnell: Harvard School of Public Health Training Institute for Dissemination and Implementation Research July 24, 2014

Transcription

1 Putting Behavioral Economics to use for Implementation Research Margaret McConnell: Harvard School of Public Health Training Institute for Dissemination and Implementation Research July 24, 2014

2 Environment for health decisions Immediate costs + delayed rewards of prevention Lots of uncertainty + ambiguity Heightened emotions or arousal Sustained continuous investments of time and effort (prevention) Potentially significant hassle costs Coordination between individuals and families Decisions impact social image and identity Difficult environment for making decisions that reflect long term goals

3 Active (relevant) research areas in BE 1) Identification of predictable behavioral patterns (biases, preferences, cognitive short-cuts) 2) Appropriate intervention design when intention action

4 Rationales for Public Health Intervention Threats to public safety Lack of information / asymmetric information Externalities Behavioral economics opens up new rationale (sometimes called internalities) Psychological barriers between intention and action We fail to do things that Are good for health We wish we would do Solution: benevolent (asymmetric) paternalism

5 Behavioral models help to understand preferences Social preferences: conformity, concerns about stigma and social image (especially among adolescents) Preferences related to uncertainty: risk preferences, loss aversion, ambiguity aversion Time preferences: problems with self control, procrastination

6 Barriers between intention and action Present-bias: Hard to focus on long-term when current priorities tempt Limited attention: Hard to keep health priorities at top of mind Bandwidth: For individuals living with scarcity (poverty, sleeplessness, stress) decision quality shown to degrade Cognitive capacity/bounded rationality: difficult to impartially perceive risk, decision fatigue, cognitive short-cuts Lack of understanding: Faulty mental models may lead to behavioral mistakes. Datta and Mullainathan (2014) Behavioral Design: A New Approach to Policy and Development Mullainathan and Shafir (2013) Scarcity: Why Having so Little Means so Much

7 Successful intervention designs from behavioral economics Power of defaults Surprising effectiveness of small incentives in changing big decisions Simple reminder / planning prompts can change sticky behaviors Active choice can lead to improved outcomes (making it costly / impossible to avoid making a choice) Social comparisons can drive behavior change in some cases (and not in other cases)

8 Lack of self control Traditional economic models: exponential discounting Behavioral model: hyperbolic discounting Time preferences are inconsistent over time The same trade-off over time is different when it includes consumption today Laibson (1997) Golden Eggs and Hyperbolic Discounting

9 Lack of self control and health Short term self: Tempted by high consumption utility now Long term self: prefers more balance between current and future utility Even if I d like to quit smoking, save for pregnancy, exercise more, stop goofing off at work -- I m tempted to put off the effort until tomorrow Solutions: Commitment Forcing my current self to be virtuous, increasing the costs to inaction Incentives Small salient incentives in the present might work better when present-biased

10 Commitment Devices will fail if Projection bias: Individuals do not correctly predict future choices and preferences Don t correctly predict they will face temptation in future Firms take advantage of this tendency: cell phone pricing credit card fees organic food plan gym membership fees: Choice between $300 gym membership and $15 for dropins. Average person with membership paid $19 per visit Lowenstein, O Donahue and Rabin (2003), Projection Bias in Predicting Future Utility Dellavigna and Malmendier (2006), Paying Not to Go to the Gym

11 Small incentives

12 Small incentives

13 Incentives: Evidence Incentives have a surprisingly large effect: may operate against multiple behavioral biases Psychology models (Lewin 1950) suggests that some costs may loom large: Inconvenience Hassle Small incentives may help to overcome these hassle factors

14 Limited attention Simpler reason people don t follow through: imperfect prospective memory / attention Planning fallacy Simple text reminders shown to help with adherence to medication, attendance at doctors visits, saving money and repaying loans Karlan, McConnell, Mullainathan and Zinman (2012) Getting to the Top of Mind: How Reminders Increase Savings

15 Importance of diagnosis Incentives and self-control generate very similar looking behavior Solutions are quite different Self control solution: commitment Limited attention solution: reminders and planning prompts

16 Cognitive Capacity: Example Choice Overload: When there are too many options, sometimes no choice is preferred! Jams study (Iyengar and Lepper 2000): 6 jams 40% stopped, 30% purchased 24 jams 60% stopped, 3% purchased Participation in 401(k) goes down 2% for every 10 extra funds Iyengar, Huberman and Jiang (2004) How Much Choice is Too Much? Contributions to 401k Retirement Plans Medicare Part D created 40 plan choices: 81% of seniors could have gotten same coverage at lower price Abaluck and Gruber 2011 Choice Inconsistencies Among the Elderly: Evidence from Plan Choice in the Medicare Part D Program."

17 Limits to understanding Ex: Low rates of breastfeeding even though women have heard that message that it is preferred Problem: Mental models about what should happen when babies cry Ex: Teenage girls choose riskier (older) sexual partners Problem: Assume teenage partners are riskier because they talk more about sex Solution: targeted information about relative risks Dupas (2011) Do Teenagers Respond to HIV Information? Evidence from a Field Experiment in Kenya Note: Not the same as saying information is the solution. Sometimes you have to correct wrong beliefs.

18 Behavioral economics also points to solutions Known behavioral biases can also be used to design programs to change behavior Present-bias: ask individuals to commit to dieting or losing weight in the future Limited Attention: move sodas to obscure locations, place stairs directly at entrances to locations Lowenstein, Brennan and Volpp (2007), Asymmetric Paternalism to Improve Health Behaviors

19 Example Organ Donation Inattention leads to better status quo (individuals enrolled in organ donation)

20 Not just patients! Health practitioners are also behavioral agents Incentive design for health workers should incorporate understanding of psychology to design better contracts In some settings commitment contracts are demanded and increase productivity Kaur, Kremer and Mullainathan (2010), Self Control and the Development of Work Arrangements Behavioral economics suggests that social image may also be a powerful motivator Benabou and Tirole (2006) Incentives and Prosocial Behavior

21 Adapting interventions to complex environments Ex: Defaults (opt-in systems to opt-out systems) Defaults have been successful with Retirement Savings in large companies Organ Donation Tend to be considered success stories where One option clearly preferred by policy makers Strong systems in place May be challenging to apply innovations involving defaults to settings with weak health systems where the right choice might not be obvious Ex: choosing right treatment at end of life

22 Ex: Safe Delivery (ongoing work with Jessica Cohen) Define: many women in Urban Nairobi who receive ANC from safe private facilities deliver at low quality public facilities Diagnose: women and their have spouses do not make a full implementable birth-plan and often going to the closest place once they are in labor Design: we have designed a transportation voucher that women can use if and only if they precommitment to a delivery location Test: we are testing the impact of this program on choice of delivery location and the quality of care received

23 Conclusions Used wisely: BE can provide guidance on how to understand / predict patterns of behavior Point to successful interventions when intentions actions Next steps for applying BE to research in D&I Diagnosis of behaviors Don t assume individuals acting against health interest is irrational Behavioral diagnosis necessary for effective interventions not every low take-up / adherence problem can be solved by information, social marketing or incentives Adaptation of BE interventions to complex health systems Opportunities for implementation of active choice? More focus on health workers instead of individuals Delivery models that incorporate patterns of decisions Ex: greater focus on convenience, bundling health with other salient objectives, use of smart incentives