Are human beings always rational? How many of our decisions are based on cool-headed calculation? Or, do we mostly decide on the basis of intuition and emotion - or simply follow what the neighbors have done, and what culture and society dictates?
‘Mind, Society and Behavior’, the World Bank’s flagship World Development Report for 2015, explores the myriad psychological, social, and cultural factors that influence the way people think and decide in their everyday lives – how they save, rear their children, invest in education, follow healthy practices, and use water and energy, to name a few.
While advertisers and marketers have long recognized the importance of emotion and context in human decision-making, the report says that the development community too will do well to view people more fully, as small changes in the design and implementation of a development program can have large consequences for the success of an intervention.
Although these findings are based on recent research from across the social sciences, they were recognized early on by Adam Smith, John Maynard Keynes and others. Now, after a respite of about 40 years, the science has come full circle.
A process of discovery and learning
The report says that challenges that may look similar can have different underlying causes, so solutions in one context may not necessarily work in another. To be successful, therefore, the report recommends that development practitioners follow an iterative process of discovery and learning, spreading time, money and expertize over several cycles of design, implementation and evaluation, without being afraid to fail and start over.
Importantly, the report says, development professionals too, like everyone else, are prone to their biases and ideological preferences. They can therefore make mistakes when taking decisions in complex social, cultural, political and economic environments.
Automatic thinking – jumping to conclusions based on limited information
The report says that human beings tend to think automatically, think socially, and think with mental models, unlike many economic models that assume that they are rational in their behavior.
Thinking automatically leads people to simplify problems in their minds. This may lead them to jump to conclusions, form a mistaken picture of a situation, and later wish they had decided otherwise.
Since even seemingly irrelevant details in presenting a situation can alter people’s perceptions, the report suggests that development practitioners adjust the information they provide and the format they provide it in to steer people in the desired direction.
What others think, expect, and do influences how we decide
Importantly, human beings are deeply social animals, strongly influenced by their identities, networks and social groupings. Social networks create collective patterns of behavior, as most people care about what others around them are doing and tend to imitate them. In China, for instance, it was found that farmers were more likely to take up weather insurance when a friend first participated in a session.
In India, microfinance clients who were assigned to meet weekly rather than monthly, were found to be more willing to pool risks and less likely to default on their second loan. Therefore, finding ways to help citizens engage with each other can often motivate them to adopt appropriate behavior, whereas left to themselves they may have trouble doing so.
Social norms too are powerful determinants of human behavior. In Kenya, for instance, when stickers asked bus passengers to chide bus drivers for reckless driving, road accidents were far fewer than when no such advice was given.
The implications for policy are clear. Social transformation not only requires individuals to change their pattern of behavior but also involves the relentless pursuit of altering social norms and institutions.
Mental models shape our understanding of what we can achieve in our lives
People’s mental models of themselves and their social groups - stereotypes - also shape their understanding of what they think they can achieve in their lives. Poverty, in particular, can blunt the aspirations of poor and disadvantaged people by generating a mental model that places a better life out of reach for people from their backgrounds.
In one study in India, when caste identities were not revealed, low caste boys proved to be just as good as high caste ones at solving puzzles. However, when these identities were made known before the problem solving session, the mental image that the low caste boys had of themselves prevented them from performing as well as their high caste peers.
Exposure to fictional dramas that provide appropriate role models can be particularly powerful in getting people to think differently and raising aspirations.
Social expectations and mental models perpetuate corruption
The report also examines collective behaviors such as widespread trust and widespread corruption. It says that people behave differently in private and when they are – or think they are - being observed. Therefore, bringing corrupt practices out in the open may exert social pressure to deter people from this behavior.
To illustrate this, the report cites the example of the NGO Janaagraha in Bangalore which initiated the low-cost internet platform ‘ipaidabribe.com’ to publicize and stigmatize bribery and shame public servants who solicit bribes.
Finally, since many of the emerging policy implications will require further study, the report encourages researchers and development practitioners to test these new approaches and carry the work forward.