The Role of Nudges in the Conservation of Natural Resources: A Behavioral Economics Approach

Document Type : Research Article

Authors

• Heshmatulah Asgari
• Mohaddeseh Pouralimardan

Department of Economics, Faculty of Literature and Humanities, Ilam University, Ilam, Iran

https://doi.org/10.22067/jead.2024.83838.1213

Abstract

Introduction
Considering the current process of destruction of natural resources in the country and the problems faced by the present and future generations, the measures taken in the field of conservation and restoration and development of natural resources do not seem to be enough. Although, to solve these problems, the role of the government as a planner and supporter of natural resources projects is clear and important (Arayesh & Farajilah Hosseini, 2010). However, the projects designed to conserve natural resources are implemented based on people's participation. In general, people's participation in projects in the field of natural resources protection can take place in various fields. The most important of these issues have been considered in the behavioral examples of the Helpers of Nature project which can be including planting seedlings, people's participation in times of crisis such as fire, protection of forests, contributing to environmental protection associations, joining environmental associations, waste management in terms of separation and volume, joining the natural resources projects through the organization's systems, introducing people to the natural resources organization in the form of nature's helper, paying the green tax and etc (Natural resources & watershed management organization-I.R of IRAN, 2023). However it is the question as how to attract people's participation in the mentioned issues requires tools that can influence human behavior. Behavioral economics, as a new scientific field of economic sciences, can measure and analyze the impact of intentions, beliefs, and motivations on human behavior and decisions, and based on this, it can also provide policy tools (Asgari et al., 2021). For this reason, it can influence people's behavior to participate in the conservation of natural resources using behavioral economics approach. Therefore, to realize the goal of attracting people's participation, the current study considers to examine nudges and the effectiveness of nudges on people's behavior using behavioral economics approach
 
Materials and Methods
The sampling method of the research is convenience sampling. The number of samples is 213 people using the online questionnaire in two separate groups. This study is a quasi-experimental design and its type is a comparison between two groups. The number of the control group includes 108 people and the number of the treatment group includes 105 people. The control and treatment groups were independent. Each of the groups had completely common questions and response criteria. In this study, the control and treatment groups did not receive any training, but only the treatment group was given additional information about cognitive errors along with related questions. First, the Mann-Whitney-Wilcoxon test is used to check and compare the ratings regarding supplementary information as well as the answers of people in the two groups. The ordered probit regression is used to analyze the relationship between ordinal or ranked dependent variables related to natural resource protection behavior and independent treatment (nudge) variables and other variables. For the relative dependent variables (the time of registration of cooperation request and the number of people introduced as a nature helper), the ordinary least square regression is used to analyze the effect of the treatment binary variable on the people's behavior in the field of natural resources conservation
 
Results and Discussion
This study results showed that out of 19 nudges, 14 nudges includes; Normative default, time limit, anchor and exemplify, carrot and stick, personalization, decoy effect, authority confirmation bias, bandwagon effect, present bias, automatic recommendation, halo effect and ownership effect (1) and (2) and (3) had a significant impact on these people's behavior, respectively, the number of seedlings, the time of registering a request for cooperation, participation in firefighting, waste production, the number of members introduced as a nature’s helper, choosing tasks, membership in associations, membership in a special association, recycling, people's action preferences for forest protection, the percentage of perceived success for projects, willingness to spend taxes to beautify one's neighborhood, willingness to spend taxes to protect forests in one's area, and applying zoning to protect forests. The direction of influence in all nudges (except for the normative default and time limit) on people's behavior has been positive and significant. The marginal effects also showed that all nudges had the positive effect (with ordinal or ranked dependent variable) on the selection of the target option(s) in the treatment group compared to the control group. The carrot and stick policy had no significant effect on the ordinal variable of waste production, but the effect of this nudge on dummy variable of waste production was significant, This means that this nudge has had a positive and significant effect on maintaining the existing situation (garbage collection every day of the week) and reducing the amount of garbage (choosing 20 kg of garbage and less per week). The normative default and the time limit had a negative and significant effect (respectively) on the number of seedlings and the registration time of cooperation requests for planting seedlings. These negative effects have also confirmed the positive effect of nudging on people's behavior. Although the normative default resulted in fewer seedlings being planted by individuals, this occurred because the default was set at a minimal level and individuals were significantly more inclined to follow the default. The nudge of the time limit also led to a reduction in the time to register cooperation requests by individuals, so that people tended to register their request faster.
 
Conclusion
According to the results of this research, to attract the people's participation in the conservation of natural resources, these following should be considered: defaults, low-cost anchors, clear examples, incentives and punishments, highlight individual performance through personalization, using existing privileges for more cooperation, confirming people's sovereignty, presenting reports during performance, immediate rewards, making SMS and telephone systems available to compensate for people's lack of action, considering time limits for registering people in programs and projects, providing success reports to join people in an action, applying people's ownership of the green tax to further encourage them to pay taxes, allocating each zone to an environmental association for forests protection.

Keywords

• Behavioral economics
• Nudge
• Natural resources
• Ordered Probit model
• Ordinary least squares

Main Subjects

• Environment and Natural Resources Economics

©2024 The author(s). This is an open access article distributed under Creative Commons Attribution 4.0 International License (CC BY 4.0), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source.

References

1. References

   1. Adar, E., Acquisti, A., Chang, D., & Krupka, E. (2020). Social Nudges for Behavior Change. University of Michigan.
   2. Andreoni, J., Harbaugh, W., & Vesterlund, L. (2003). The carrot or the stick: Rewards, punishments, and cooperation. American Economic Review, 93(3), 893-902.
   3. Arayesh, B., & Farajilah Hosseini, S. (2010). The regression analysis of effective factor on people participation in rotecting, revitalizing, developing and using renewable natural resources from the view of natural resources experts in Ilam province. Journal of Agricultural Economics and Development, 24(1), 49-58. (In Persian). https://doi.org/10.22067/jead2.v1389i1.3491
   4. Asgari, H., Roozitalab, A., & Mansouri, A. (2021). Behavioral analysis of willingness to pay taxes (A case study of Semnan industrial town). Journal Tax Research, 29(49), 7-32. (In Persian)
   5. Asgari, H., & Pouralimardan, M. (2022). Quantitative effects of public perception on demand for Covid-19 vaccines: A behavioral economics approach in Iran. Iranian Economic Review, Article in Press. https://doi.org/10.22059/ier.2022.87699
   6. Asgari, H., & Pouralimardan, M. (2023). Evaluation of projection bias in people’s beliefs and intentions under the influence of temperature changes (With behavioral economics approach). Journal of Applied Economics Studies in Iran, 12(46), 39-61. https://doi.org/10.22084/aes.2022.26567.3486
   7. Asghari Jafarabadi, M., & Mohammadi, M. (2015). Statistical series: Common non-parametric methodes. Iranian Journal of Diabetes and Metabolism, 14(3), 145-162. (In Persian)
   8. Białek, M., Gao, Y., Yao, D., & Feldman, G. (2023). Owning leads to valuing: Meta‐analysis of the mere ownership effect. European Journal of Social Psychology, 53(1), 90-107.
   9. Borg, W. R., & Gall, M. (1979). Educational Research: An Introduction (3rd ed.). New York: Longman.
   10. Chakravarty, S., & Mishra, R. (2019). Using social norms to reduce paper waste: Results from a field experiment in the Indian Information Technology sector. Ecological Economics, 164, 106356.
   11. Clot, S., Grolleau, G., & Ibanez, L. (2022). Projection bias in environmental beliefs and behavioural intentions-An application to solar panels and eco-friendly transport. Energy Policy, 160, 112645.
   12. Cohen, L., Manion, L., & Morrison, K. (2007). Research Methods in Education (6^th). Routledge. https://doi.org/10.4324/9780203029053
   13. Crusius, J., Corcoran, K., & Mussweiler, T. (2022). Social comparison: Theory, research, and applications. Theories in social psychology, 165.
   14. Direr, A. (2020). Bringing present bias back to the present. Available at https://ssrn.com/abstract=3420916.
   15. Endendijk, T., & Botzen, W.W. (2023). A default nudge in waste management: assessing the impact of explicit consent for unaddressed mail. Journal of Environmental Economics and Policy, 1-17. https://doi.org/10.1080/21606544.2023.2166129
   16. Enste, D., & Potthoff, J. (2021). Behavioral economics and climate protection: Better regulation and green nudges for more sustainability (No. 146). IW-Analysen.
   17. Eshaghi, S.R., Rezaei, R., Hejazi, S.Y., Shiri, N., & Ghadimi, S.A. (2013). Analyzing the factors affecting on rural people’s participation in the projects of natural resources conservation. Iranian Journal of Agricultural Economics and Development Research, 44(3), 463-471. (In Persian). https://doi.org/10.22059/ijaedr.2013.50233
   18. Farahanifard, S. (2007). Intergenerational justice in the exploitation of natural resources. Islamic Economics, 7(25), 125-157. (In Persian)
   19. Feizi, M., & Khatabiroudi, N. (2023). Social and environmental nudges and water usage: Evidence from a field experiment in Iran. Water Resources and Economics, 42, 100223.
   20. Fierro, C. (2020). The application of economics behavior towards the nudging innovation in social marketing communication: how the users perceives nudging: is it always a winning strategy?.
   21. Furnham, A., & Boo, H.C. (2011). A literature review of the anchoring effect. The Journal of Socio-Economics, 40(1), 35-42.
   22. Gan, M., & Ouyang, Y. (2022). Study on tourism consumer behavior characteristics based on big data analysis. Frontiers in Psychology, 13,
   23. Greene, W.H. (1993). Econometric Analysis, Macmillan. New York.
   24. Greene, W.H., & Hensher, D. A. (2010). Modeling ordered choices: A primer. Cambridge University Press.
   25. Kahneman, D., & Tversky, A. (1979). Prospect theory: An analysis of decision under risk. Econometrica, 47(2), 263-292.
   26. Keshavarz, M., Damghanian, H., Ebrahimi, S.A., & Rastgar, A. (2021). Investigating the role of environmental sensitivity on employee pro-environmental behavior with considering the mediating role of social comparison nudge and green nudge. Management Studies in Development and Evolution, 30(102), 65-96. (In Persian). https://doi.org/10.22054/jmsd.2021.44341.3369
   27. Li, B., Chen, Y., & Cao, S. (2023). Carrot and stick: Does dual-credit policy promote green innovation in auto firms? Journal of Cleaner Production, 403,
   28. Li, L., Ding, X., Sarkar, A., & Li, H. (2023). Assessing the impact of confirmation of rights and collective trust on farmer’s forestry management and protection behaviour—A case of collective forest areas in Zhejiang and Jiangxi provinces, China. Forests, 14(2), 376.
   29. Ling, M., Xu, L., & Yang, H. (2023). Direct and spillover effects of social norm nudges for household recycling: A longitudinal field experiment. Sustainable Production and Consumption.
   30. López Carrillo, G. (2022). Static and dynamic social norms on recycling behaviour: an intervention and maintaining study.
   31. Manshoven, S., & Van Opstal, W. (2022). The carrot or the stick? Stakeholder support for mandatory regulations towards a circular fashion system. Sustainability, 14(22),
   32. Meshkani, M. R. (2019). Wald Test. Encyclopedia of Economics, 2(2), 1-2.
   33. Mills, S. (2022). Personalized nudging. Behavioural Public Policy, 6(1), 150-159.
   34. Mo, F., Matsumoto, T., Fukushima, N., Kido, F., & Yamana, H. (2022). Decoy effect of recommendation systems on real e-commerce Websites. In CEUR Workshop Proceedings, 3222, 151-163. CEUR-WS.
   35. Morovat, H., Sharif, M., & Nezakat, P. (2020). Investigating the effect of cognitive biases (hot-hand effect and hyperbolic discount Rate) on environmental attitudes and behaviors in Iran. Quarterly Journal of Applied Theories of Economics, 6(4), 163-190. (In Persian)
   36. Mosier, K.L., & Manzey, D. (2019). Humans and automated decision aids: A match made in heaven?. InHuman Performance in Automated and Autonomous Systems, 19-42.
   37. Natural resources & watershed management organization -I.R of IRAN site, 2023. https://frw.ir/
   38. Noor, N., Beram, S., Yuet, F.K.C., Gengatharan, K., & Rasidi, M.S.M. (2023). Bias, Halo Effect and Horn Effect: A Systematic Literature.
   39. Pouralimardan, M., & Asgari, H. (2022). Bias in Wages and time ppreferences (an application of behavioral economics). Iranian Journal of Economic Research, 27(93), 177-220. (In Persian). https://doi.org/10.22054/ijer.2022.66212.1072
   40. Preston, S.D., & Gelman, S.A. (2020). This land is my land: Psychological ownership increases willingness to protect the natural world more than legal ownership. Journal of Environmental Psychology, 70,
   41. Ritov, I., & Baron, J. (1990). Reluctance to vaccinate: Omission bias and ambiguity. Journal of Behavioral Decision Making, 3(4), 263-277.
   42. Rodriguez-Lara, I. (2015). An experimental study of gender differences in distributive justice. Cuadernos de Economía, 38(106), 27-36.
   43. Rogers, E.S., Vargas, E., Wysota, C.N., & Sherman, S.E. (2022). Latent heterogeneity in the impact of financial coaching on delay discounting among low-income smokers: A secondary analysis of a randomized controlled trial. International Journal of Environmental Research and Public Health, 19(5), 2736.
   44. Röthlisberger, M. (2020). Digital nudging decoy effect and social norms nudge in e-commerce.
   45. Schley, C. (2021). A mediation Study: The effect of self-enhancement values on the relationship between egoism and pro environmental behaviour. Bachelor's thesis, University of Twente.
   46. Schmitt‐Beck, R. (2015). Bandwagon effect. The international encyclopedia of political communication, 1-5.
   47. Sunstein, C.R., & Reisch, L.A. (2021). Climate-friendly default rules. Springer International Publishing. 141-164.
   48. Thaler, R.H., & Sunstein, C.R. (2008). Nudge: Improving decisions about health, wealth, and happiness. Yale University Press. Translated by Mehri Modabadi. Tehran. Hormazd Publications
   49. Tversky, A., & Kahneman, D. (1974). Judgment under Uncertainty: Heuristics and Biases: Biases in judgments reveal some heuristics of thinking under uncertainty. Science, 185(4157), 1124-1131.
   50. Valatin, G., Moseley, D., & Dandy, N. (2016). Insights from behavioural economics for forest economics and environmental policy: Potential nudges to encourage woodland creation for climate change mitigation and adaptation?. Forest Policy and Economics, 72, 27-36.
   51. Vatamanescu, E.M., Pînzaru, F., & Anghel, L.C. (2014). A managerial perspective on common identity-based and common bond-based groups in non-governmental organizations, patterns of interaction, attachment and social network configuration. Management Dynamics in the Knowledge Economy, 2(2), 265.
   52. Wang, X., Fielding, K.S., & Dean, A.J. (2023). “Nature is mine/ours”: Measuring individual and collective psychological ownership of nature. Journal of Environmental Psychology, 85,