World Development Report 2015: Mind, Society, and Behavior

"Can providing a role model change a person's opinion of what is possible in life and what is 'right' for a society? Can marketing a social norm of safe driving reduce accident rates? Can providing information about the energy consumption of neighbors induce individuals to conserve? As this Report will argue, the answers provided by new insights into human factors in cognition and decision making are a resounding yes..."

This World Bank report aims to integrate recent findings on the psychological and social underpinnings of behaviour to make them available for more systematic use by both researchers and practitioners in development communities. It explores the psychological, social, and cultural factors that influence the way people think and make decisions in their everyday lives about such issues as how to save money, rear their children, invest in education, follow healthy practices, and use water and energy. It argues that, since people are strongly influenced by their identities, networks, and social groupings - not merely by "rational" choice, as economic models assume - a more realistic understanding of human behaviour can help make development policies more effective. The framework and many examples in the report show how impediments to people's ability to process information and the ways societies shape mindsets can be sources of development disadvantage but also can be changed.

From the hundreds of empirical papers on human decision making that form the basis of this report, three principles stand out as providing the direction for new approaches to understanding behaviour and designing and implementing development policy:

1. People make most judgments and most choices automatically, not deliberatively ("thinking automatically"). 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.
2. How people act and think often depends on what others around them do and think ("thinking socially"). Social networks create collective patterns of behaviour, 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. Finding ways to help citizens engage with each other can often motivate them to adopt appropriate behaviour, 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. This indicates that social transformation not only requires individuals to change their pattern of behaviour but also involves the relentless pursuit of altering social norms and institutions.
3. Individuals in a given society share a common perspective on making sense of the world around them and understanding themselves ("thinking with mental models"). People's mental models of themselves and their social groups - stereotypes - shape their understanding of what they think they can achieve in their lives. Poverty, in particular, can blunt the aspirations of economically 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. The report shows that exposure to fictional dramas that provide appropriate role models can be particularly powerful in getting people to think differently and raising aspirations. In fact, entertaining educational narratives - e.g., television and radio shows that incorporate social messages - have been found to drive key development choices, which can reduce teenage pregnancy, improve savings rates, and increase women's autonomy, for example.

The report also examines collective behaviours 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 behaviour. To illustrate this, the report cites the example of the non-governmental organisation (NGO) Janaagraha in Bangalore, which initiated the low-cost internet platform "ipaidabribe.com" to publicise and stigmatise bribery and shame public servants who solicit bribes.

As an example of how this framework could be applied to a particular development challenge, seen under a psychological and social lens, the report considers the problems of low personal savings and high household debt. Field experiments demostrate that other factors beyond the standard variables of prices, incomes, and regulations affect saving behaviour, including automatic thinking that reacts to the framing and perception of choices, the widespread tendency to adhere to social norms, and the mental models of one's place in life. For example, conventional financial literacy programmes in low- income countries have had limited effects. In contrast, an effort in South Africa to teach financial literacy through an engaging television soap opera improved the financial choices that individuals made. Financial messages were embedded in a soap opera about a financially reckless character. Households that watched the soap opera for two months were less likely to gamble and less likely to purchase goods through an expensive installment plan (Berg and Zia 2013). The households felt emotionally engaged with the show's characters, which made them more receptive to the financial messages than would be the case in standard financial literacy programmes. The success of the intervention depended on "thinking socially" - our tendency to identify with and learn from others. A similar example from Ethiopia, where disadvantaged individuals commonly report feelings of low psychological agency, showed that households that watched an hour of inspirational videos comprising four documentaries of individuals from the region telling their personal stories about how they had improved their socio-economic position by setting goals and working hard had higher total savings and had invested more in their children's education.

As stated here, the view that labeling, role models, and aspirations can affect savings is not inconsistent with the view that people respond in predictable ways to changes in interest rates or prices and other incentives. The approaches presented in the report are not meant to replace standard economics but, rather, to enhance our understanding of the development process and the way development policies and interventions can be designed and implemented. "Because policy makers are themselves subject to cognitive biases, they should search for and rely on sound evidence that their interventions have their intended effects, and allow the public to review and scrutinize their policies and interventions, especially those that aim to shape individual choice."

Overviews of and main messages from the report are available in Arabic, Chinese, English, French, Portuguese, Russian, and Spanish; click here and scroll down to access these documents and other portions of the report in PDF (and audio) format. The full report then includes:

Part 1: An expanded understanding of human behavior for economic development: A conceptual framework

• Chapter 1: Thinking automatically
• Chapter 2: Thinking socially
  • Spotlight 1: When corruption is the norm
• Chapter 3: Thinking with mental models
  • Spotlight 2: Entertainment education

Part 2: Psychological and social perspectives on policy

• Chapter 4: Poverty
  • Spotlight 3: How well do we understand the contexts of poverty?
• Chapter 5: Early childhood development
• Chapter 6: Household finance
• Chapter 7: Productivity
  • Spotlight 4: Using ethnography to understand the workplace
• Chapter 8: Health
• Chapter 9: Climate change
  • Spotlight 5: Promoting water conservation in Colombia

Part 3: Improving the work of development professionals

• Chapter 10: The biases of development professionals
• Chapter 11: Adaptive design, adaptive interventions
  • Spotlight 6: Why should governments shape individual choices?