Tuesday, March 25, 2008

It's all about feedback, or transparency as I call it.

Today in the Science Times, John Tierney has a column on mechanisms to provide feedback to people on their energy use. The theme of his column is basically how can you nudge people to do the right thing. An interesting anecdote was that when power companies published how one's energy usage compared to your neighbors, people over the average reduced their consumption. However, people below the average RAISED theirs. Hmmm, guess we all do want to be average. The power company then annotated the bills with value judgments, in this case smiley faces for people below the average and frowny faces for those above the average. Overall power consumption went down. I kid you not, what next gold stars on your electricity bills. It goes to show you that simple solutions work.

To that end, Tierney proposes an energy mood ring to let you know where your energy consumption lies.

In Tierney's associated blog post he explores more research on the psychology of nudges. Our assumptions of rationality in our decisions breaks down the more the impact of our decision becomes abstract. Think saving for our retirement, so making our actions more clear on their consequences both in the long term and short remains the challenge.

I think one of the reasons I'm more environmentally aware is my training in the sciences. We spend a lot of time understanding the role of subsidiary effects. For instance, in biology we study growth curves and after a period of exponential growth there is always a crash. However in business most exponential growth curves assume a plateau. That slight change in view changes the color of your glasses.


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