Nudging as climate policy - can behavioral interventions increase the efficiency of climate policy?

Thumbnail Image
Journal Title
Journal ISSN
Volume Title
School of Business | Bachelor's thesis
Degree programme
This thesis is a literature review on climate economic policies. The purpose of this thesis is to make visible the recent trend in academic discussion about behavioral interventions as viable policy tools, specifically in the context of fighting against climate change. The available literature indicates a need for policy tools to acknowledge behavioral failures in conjuncture with the commonly analysed market failures of climate change. In this thesis behavioral interventions, primarily titled “green nudging”, are introduced and evaluated. The key challenges of these behavioral policies, such as nudging, seems to be the lack of a coherent theoretic framework and missing research on their (co)efficiency as policy tools. There is currently effort in the literature to both provide with more cohesive definitions of nudging, for example, and also to evaluate the available behavioral interventions better as policies. Behavioral interventions are largely understood to be better as complementary, rather than substitutive policies for standard economic policies (e.g. green taxes and quotas), and therefore the necessity of evaluating the coefficiency of these policies is emphasized. Contemporarily, there is not enough research on the empirical efficiency of behavioral interventions, which is identified as a significant research gap to be filled in the future. The cautious academic consensus seems to be, however, that green nudging presents a promising policy tool extension for climate policies especially. There are valid concerns over the contextuality and ethical problems related with using behavioral interventions as policy, which also deserve more attention in the academic literature. These research gaps provide an excellent opportunity for further research on this interdisciplinary subject.
Thesis advisor
Stryjan, Miri
Murto, Pauli
nudging, environmental economics, behavioral economics, climate policy, green nudges, nudges, efficiency
Other note