How best to nudge taxpayers? The impact of message simplification and descriptive social norms on payment rates in a central London local authority

Abstract

Behavioral insights or nudges have yielded great benefits for toda's public administrators by improving the quality of official messages and increasing revenue flows. In the absence of a large number of studies suitable for meta-analysis, less is known about the external validity of these interventions, their range of impact, and the exact matching of the behavioral cue to the client group and context. Factorial designs and repeated interventions, as in the study reported in this article, can add insight through respectively comparing interventions and analyzing their impacts over time. This randomized controlled trial tests whether simplification and/or a descriptive social norm can increase payment of local taxes in a central London local authority. In the first wave, a factorial design on a targeted group of residents, simplification increased the number of people paying by four percentage points, whereas the social norm did not change behavior. In wave two of the study, which was carried out across all households, the descriptive social norm backfired, reducing the rate of payment. The heterogeneous nature of the target population and the exact wording of the social norm are discussed as possible reasons for these results.

Social influence and forest habitat conservation: Experimental evidence from Vermont's maple producers

“…While the letter itself increased enrollment, the effect was unchanged by the addition of social information. Efforts to increase tax payment compliance and 401(k) contributions also found providing information about the behavior of others to have a negative effect on behavior (Beshears, Choi, Laibson, Madrian, & Milkman, 2015;John & Blume, 2018). A growing body of research on similar "nudge" interventions suggests other concerns, including unintended welfare costs, rebound effects, and limitations to the depth and length of behavior-change (Sunstein, 2017).…”

“…Maple producers' sense of autonomy may have been threatened by the social pressure message, thus, producing a defiant "no" (a response known as " psychological reactance") (Steindl, Jonas, Sittenthaler, Traut-Mattausch, & Greenberg, 2015). Efforts to increase tax payment compliance and 401(k) contributions also found providing information about the behavior of others to have a negative effect on behavior (Beshears, Choi, Laibson, Madrian, & Milkman, 2015;John & Blume, 2018). Third, perhaps the information that others were participating in the program and providing habitat caused some producers to free-ride.…”

Requiem for a Nudge: Framing effects in nudging honesty

“…There, personalized messages -and sometimes physical letters -are being sent with the intent to achieve behavior change in the forms of increasing tax compliance, charitable giving, primary school enrollment, and student learning, or in the form of decreasing energy consumption, student absenteeism from school, credit card debt, and even the spread of HIV infections, among other examples (Reinikka and Svensson, 2005;Dupas, 2011;Luttmer and Singhal, 2014;Boyer et al, 2016;Brandon et al, 2017;Rogers and Feller, 2018;Bursztyn et al, 2019). In existing literature, such information-only interventions indicate mixed results, with some studies demonstrating success (Hallsworth et al, 2017;Hernandez et al, 2017;Bott et al, 2019) while others either fail to detect a significant effect (Blumenthal et al, 2001;Fellner et al, 2013;Castro and Scartascini, 2015;Kettle et al, 2017;Cranor et al, 2018;Dunning et al, 2019) or indicate that interventions may backfire (John and Blume, 2018;Bicchieri et al, 2019c).…”

The INSPIRE Framework: How Public Administrators Can Increase Compliance with Written Requests Using Behavioral Techniques

“…The influence of norms on human behavior has been demonstrated in a variety of areas, including littering (Cialdini, Reno, and Kallgren ), energy conservation (Alcott ; Schultz et al ), and financial donations (Martin and Randal ). Although there are also studies in which social norms have had no effect (John and Blume ; Silva and John ) or even unintended negative effects (John and Blume ), systematic reviews have shown the influence of norms on several types of behavior, including eating behavior (Robinson et al ) and intentions to use technology (Schepers and Wetzels ).…”

“…Although there are also studies in which social norms have had no effect (John and Blume 2018;Silva and John 2017) or even unintended negative effects (John and Blume 2018), systematic reviews have shown the influence of norms on several types of behavior, including eating behavior (Robinson et al 2014) and intentions to use technology (Schepers and Wetzels 2007).…”