Govt should use ‘nudge’ to elbow out corruption

The Economic Survey’s suggestion to set up a ‘Nudge Unit’ in the Niti Aayog is welcome. The idea is to nudge people’s behaviour and perceptions towards various government programmes and initiatives in the positive direction.

Having authored at least two books and many articles hinging on behavioural economics over more than two decades, I certainly think this is an idea whose time has been overdue. After all, even the World Development Report 2015 has a section on ‘Mind, Society and Behaviour’ (from which some of the examples in this article are drawn).

Examples of successful nudges in modifying social behaviour abound. The image of the fly — to aim at — on the urinal bowls is a widely known application of nudge. Nudging has also been used to modify public behaviour for traffic safety. There was this tricky bend on a road where motorists were reluctant to slow down, notwithstanding standard appeals to do so. The authorities finally managed to slow down motorists by painting the dotted lines dividing the lanes, shorter and closer to each other so that the motorists got an illusion of higher speed than their actual speed, thus involuntarily slowing down a tad.

In another example, a department store placed green arrows leading to the fruit and vegetables aisles. The store found that shoppers automatically followed the arrows nine times out of 10, and their sales of farm produce increased significantly.

There may be many areas where the government could employ nudging strategies to modify public behaviour, but none more urgent than using nudge to control corruption – by far India’s greatest challenge.

When you regard corruption as the use of public office for private gain, it assumes myriad forms. Bribery, kickbacks, fraud, embezzlement, extortion, influence peddling, cronyism, nepotism, patronage, vote-buying and vote-rigging, short-changing, match-fixing are all forms of corruption. A babu takes a bribe; a traffic constable lightens the pockets of a driver; a judge peddles his decision; an Income Tax officer armtwists a taxpayer. All such wide-spread actions provide a powerful foundation for reform. And yet, we miss the social element that makes corruption a persistent problem.

We need to understand that engaging in corruption may no longer be an individual choice but a social behaviour. For example, if a society believes that the purpose of obtaining public office is to provide one’s family and friends with money, goods, favours or appointments (why else do we Indians almost universally prefer government jobs over private sector jobs?), that society can be said to be perpetuating the norms of corruption, so much so that if someone violated this ‘norm’ (by eschewing nepotism, for example), the social networks, or even peers, could punish the public servant by decrying or ostracising him in their circles, or filing complaints against him, and so on. Such social norms create an equilibrium in which corruption becomes the norm, even though privately much of the population would prefer a clean public service.

If ‘proof’ is needed that our corruption may have become a social norm, look no further than our own bureaucracy, in which pressure to engage in corruption mostly comes from within. We have, for instance, a highly institutionalised informal system of purchasing transfers in all services — whether Railways, Police, Land Registration Offices, PWDs, or Electricity Boards — from one position or location to another, complete with rate lists, with the price dependent on the amount the office-holder expects to extract from his constituents for providing various services in the new position. In all these systems, those who do not participate, risk retribution. Supervisors report them as being “tactless”, “unrealistic,” “unable to manage” or “impractical” and such. Those who resist might be wheedled into compliance with both carrot and stick; threats or stories of how the system is fair and that everybody should be a team player and such.

So how can nudging or elements of behavioural economics help modify large-scale social behaviour?

In the UK, people in arrears of their taxes were sent reminders worded as social normative messages, such as: “9 out of 10 people in your area are up-to-date with their taxes.” If you had not paid yours, you felt like an outlier and hastened to comply. In Uganda, where government schools were receiving only 24% of the funds they were entitled to because of corrupt officials, newspapers started publishing the correct amount that the schools were supposed to receive. This increased the collections to an average of 80% of the entitled amounts.

Thus, a good nudging strategy should create conditions that make individuals think deliberately about their actions rather than “go with the flow”. A Chennai-based NGO, 5thPillar – Citizens for Democracy, used a ‘Zero Rupee Note’, with the inscription, “I promise to neither accept nor give a bribe,” to be handed over to bribe-seekers. It was a powerful nudge in controlling corruption in some areas. Ipaidabribe.com of Janagraha in Bengaluru was another nudge in the same direction. Similarly, Bengaluru, notorious for its pot-holed roads, was nudged into action by artist Nanjundaswamy when he planted a fibre-glass life-sized crocodile alongside a 12-foot pothole.

The government needs to formally declare corruption as public enemy No.1 and take it on, all guns blazing, behavioural nudging included. The government’s messaging in the fight against corruption must provide non-material incentives for participation in such campaigns, invoking a shared sense of purpose, feelings of solidarity, and public prestige for those who stand-up, push-back or fight against corruption. It needs to step-up strong anti-corruption campaigns and social-marketing messages, to loosen the bond of social sanction that corruption enjoys. Such campaigns would have to be highly conspicuous, especially when public enforcement action takes on politically powerful individuals, widely believed to be above the law.

But none of it would be effective unless the government also walks the talk.

(The writer is Director, Schulich School of Business, India Programme)