Policy Beats Morality

(Cross­posted from Medium)

This is a sim­ple point, but one that gets over­looked, so I think it de­serves a clear state­ment. Mo­ral­ity is less effec­tive than in­cen­tives at chang­ing be­hav­ior, and most of the time, policy is the way in­cen­tives get changed.

Tel­ling peo­ple the right thing to do doesn’t work. Even if they be­lieve you, or un­der­stand what you are say­ing, most peo­ple will not change their be­hav­ior sim­ply be­cause it’s the right thing to do. What works bet­ter is chang­ing the in­cen­tives. If this is done right, peo­ple who won’t do the right thing on their own of­ten sup­port the change, and their be­hav­ior will fol­low.

I re­mem­ber read­ing a story that I think was about Martin Gard­ner’s column (Edit:it was Dou­glas Hofs­tadter’s—thanks gjm!) in Scien­tific Amer­i­can in which he asked em­i­nent sci­en­tists to write in whether they would co­op­er­ate with some­one de­scribed as be­ing “as in­tel­li­gent as them­selves” in a one-shot pris­oner’s dilemma. He was dis­ap­pointed to find that even many of the smartest peo­ple in the world were ra­tio­nal, in­stead of su­per­ra­tional. De­spite his as­ser­tion that in­tel­li­gent enough peo­ple should agree that su­per­ra­tional­ity leads to bet­ter out­comes for ev­ery­one, those peo­ple fol­lowed their in­cen­tives, and ev­ery­one defected. Per­haps we can chalk this up to their lack of aware­ness of newer var­i­ants of de­ci­sion the­ory, but the sim­pler ex­pla­na­tion is that moral­ity is a weak tool, and peo­ple know it. The benefi­cial na­ture of the “moral­ity” of non-defec­tion wasn’t enough to con­vince par­ti­ci­pants that any­one would go along.

En­vi­ron­men­tal­ists spent decades at­tempt­ing “moral sua­sion” as a way to get peo­ple to re­cy­cle. It didn’t work. What worked was curb-side pickup of re­cy­cling that made money for mu­ni­ci­pal­ities, paired with fines for putting re­cy­clables in the reg­u­lar garbage. Un­sur­pris­ingly, in­cen­tives mat­ter. This is well un­der­stood, but of­ten ig­nored. When peo­ple are told the way to curb pol­lu­tion is to eat less meat or drive less, they don’t listen. The rea­son their be­hav­ior doesn’t change isn’t be­cause it’s “re­ally” the fault of com­pa­nies, it’s be­cause moral­ity doesn’t change be­hav­ior much — but policy will.

The rea­son poli­tics is even re­lated to policy is be­cause poli­ti­ci­ans like be­ing able to ac­tu­ally change pub­lic be­hav­ior. The effec­tive­ness of policy in chang­ing be­hav­ior is the sec­ondary rea­son why — af­ter dona­tions by In­tuit and H&R Block — congress will never sim­plify the tax code. To para­phrase /​ dis­agree with Scott Alexan­der, “So­ciety Is Fixed, Policy Is Mutable.” Public policy can change the in­cen­tives in a way that makes oth­er­wise im­pos­si­ble im­prove­ments turn into de­faults. Pu­n­ish­ment mechanisms are (at least some­times) suffi­cient to in­duce co­op­er­a­tion among free-rid­ers.

Policy doesn’t change cul­ture di­rectly, but it cer­tainly changes be­hav­iors and out­comes. So I’ll say it again: policy beats moral­ity.

*) Yes, tech­nolog­i­cal change and in­no­va­tion can ALSO drive changes in in­cen­tives, but pre­dict­ing the di­rec­tion of such changes is re­ally hard. This is why I’m skep­ti­cal that in­no­va­tion alone is a good tar­get for chang­ing sys­tems. Even when tech­nol­ogy low­ers the cost of re­cy­cling, it’s rarely clear be­fore­hand whether new tech­nol­ogy will in fact man­age to prompt such changes — elec­tric trol­leys were a bet­ter tech­nol­ogy than early cars, but they lost. Elec­tric cars are still rare. Nu­clear power is the low­est car­bon al­ter­na­tive, but it’s been reg­u­lated into in­effi­ciency.