Financial policymakers increasingly rely on behavioural insights to protect the interests of consumers. However, little is known about how citizens feel about interventions designed to nudge their financial behaviour. Most literature on the acceptability of behavioural interventions focuses on the health domain. To address this gap, we present the results of an experiment on the acceptability of seven financial behavioural interventions (N = 684, members of a panel of the Dutch Authority for the Financial Markets). We investigate the role of the agent implementing the intervention (policymaker versus financial company) and perceived effectiveness in relation to the acceptability of these interventions. The acceptability of behavioural interventions in financial decision-making appears to be lower than the acceptability levels found in previous studies. We find no effect of the agent on acceptability. Perceived effectiveness is strongly correlated with acceptability, but only perceived effectiveness in influencing one's own decisions has a consistently positive relationship with acceptability. Perceived effectiveness in influencing others' decisions has either no, a positive, or a negative relationship with acceptability. These results highlight that acceptability appears to be at least partly domain-specific and show that we have only just begun understanding the acceptability of behavioural interventions and its drivers.

The present study investigates the relation of procedural transparency and compliance with authorities’ regulations. The underlying assumption is that procedural transparency encourages compliance with regulations. In an incentivized experiment, 666 participants took on the role of a business owner and had to fill in a form and spend a certain amount of their income as compliance costs to adhere to safety rules. In a 2 (Business Size: small vs big) × 2 (Penalty Rate: equal vs unequal) × 2 (Penalty Scheme: transparent vs nontransparent) between-subjects design, we investigated whether an unequal penalty rate for small-size in contrast to big-size businesses had a different effect on compliance when this difference was transparent compared to when it was not transparent. Business income, compliance costs, and audit probability were varied within-subject, over 18 decision rounds. We find that the deterring effect of a higher penalty rate for big-size compared to small-size businesses under a nontransparent unequal penalty scheme is attenuated when the same information is available. This supports the idea of a backfiring effect and suggests that authorities need to carefully consider what information about their procedures to communicate in order to avoid the unintended negative effects of increasing transparency.

Voters prefer political candidates who are currently in office (incumbents) over new candidates (challengers). Using the premise of query theory (Johnson, Häubl & Keinan, 2007), we clarify the underlying cognitive mechanisms by asking whether memory retrieval sequences affect political decision making. Consistent with predictions, Experiment 1 (N= 256) replicated the incumbency advantage and showed that participants tended to first query information about the incumbent. Experiment 2 (N= 427) showed that experimentally manipulating participants’ query order altered the strength of the incumbency advantage. Experiment 3 (N= 713) replicated Experiment 1 and, in additional experimental conditions, showed that the effects of incumbency can be overridden by more valid cues, like the candidates’ ideology. Participants queried information about ideologically similar candidates earlier and also preferred these ideologically similar candidates. This is initial evidence for a cognitive, memory-retrieval process underling the incumbency advantage and political decision making.

An insurance policy may not only affect the consequences for victims but also forperpetrators. In six experiments we find that people recommend milderpunishments for perpetrators when the victim was insured, although peoplebelieve that a sentence should not depend on the victim’s insurancestatus. The robustness of this effect is demonstrated by showing thatrecommendations can even be more lenient for crimes that are in fact moreserious but in which the victim was insured. Moreover, even when harm waspossible but did not materialize, people still prefer to punish crimes lessseverely when the (potential) victim was insured. The final two experimentssuggest that the effect is associated with a change in (1) compassion for thevictim and (2) perceived severity of the transgression. Implications of thisphenomenon are briefly discussed.

In this paper we test two hypotheses regarding magical thinking about theperceived likelihood of future events. The first is that people believe thatthose who “tempt fate” by failing to take necessary precautionsare more likely to suffer negative outcomes. The second is the“protection effect”, where reminding people of precautions theyhave taken leads them to see related risks as less likely. To this end, wedescribe the results from three attempted direct replications of a protectioneffect experiment reported in Tykocinski (2008) and two replications of atempting fate experiment reported in Risen and Gilovich (2008) in which we add atest of the protection effect. We did not replicate the protection effect butdid replicate the tempting fate effect.

In three studies, we examined factors that may temporarily attenuate information search. People are generally curious and dislike uncertainty, which typically encourages them to look for relevant information. Despite these strong forces that promote information search, people sometimes deliberately delay obtaining valuable information. We find they may do so when they are concerned that the information might interfere with future pleasurable activities. Interestingly, the decision to search or to postpone searching for information is influenced not only by the value and importance of the information itself but also by well-being maintenance goals related to possible detrimental effects that negative knowledge may have on unrelated future plans.

In the current paper we investigate how feedback over decision outcomes may affect future decisions. In an experimental study we demonstrate that if people receive feedback over the outcomes they obtained (“factual outcomes”) and the outcomes they would have obtained had they decided differently (“counterfactual outcomes”), they become regret-averse in subsequent decisions. This effect is not only observed when this feedback evoked regret (with counterfactual outcomes being higher than factual outcomes), but even when the feedback evoked no regret (with factual outcomes being equal to counterfactual outcomes). The findings suggest that this effect on subsequent decisions is at least partly due to the transfer of a comparison mind-set triggered in the prior choice.

A series of 7 experiments found that people defer important decisions more than unimportant decisions, and that this is independent of choice set composition. This finding persists even when deferral does not provide more flexibility (Experiment 2), when deferral has potential disadvantages (Experiment 3), and when deferral has no material benefits and is financially costly (Experiment 4). The effect of importance on deferral was independent of potential choice conflict (Experiment 5 & 6). The only exception was a situation in which one alternative was clearly dominant; here decision importance did not affect the likelihood of deferral (Experiment 7). These results suggest that people use decision importance as a cue for deferral: more important decisions should take more time and effort.

The sunk cost fallacy is the tendency to continue an endeavour once an investment in money, effort, or time has been made. We studied how people’s chronic orientation to cope with failing projects (i.e., action vs. state orientation) influences the occurrence of this sunk cost effect. We found that people with a state orientation, who have a tendency to ruminate about past events and have a hard time to let go of them, were especially prone to fall in the sunk cost trap. People with an action orientation, who more easily let go of past events, were not susceptible to the sunk cost effect. We discuss the implications of these results for the sunk cost fallacy literature.

Third-party punishment has recently received attention as an explanation for human altruism. Feelings of anger in response to norm violations are assumed to motivate third-party sanctions, yet there is only sparse and indirect support for this idea. We investigated the impact of both anger and guilt feelings on third-party sanctions. In two studies both emotions were independently manipulated. Results show that anger and guilt independently constitute sufficient but not necessary causes of punishment. Low levels of punishment are observed only when neither emotion is elicited. We discuss the implications of these findings for the functions of altruistic sanctions.

We present a motivational account of the impact of emotion on decision making, termed the feeling-is-for-doing approach. We first describe the psychology of emotion and argue for a need to be specific when studying emotion's impact on decision making. Next we describe what our approach entails and how it relates emotion, via motivation to behavior. Then we offer two illustrations of our own research that provide support for two important elements in our reasoning. We end with specifying four criteria that we consider to be important when studying how feeling guides our everyday doing.

Investors, like any decision maker, feel regret when they compare the outcome of an investment with what the outcome would have been had they invested differently. We argue and show that this counterfactual comparison process is most likely to take place when the decision maker’s expectations are violated. Across five scenario experiments we found that decision makers were influenced only by forgone investment outcomes when the realized investment fell short of the expected result. However, when their investments exceeded prior expectations, the effect of foregone investment on regret disappeared. In addition, Experiment 4 found that individual differences in the need to maximize further moderated the effects of their expectations, such that maximizers always take into account the forgone investment. The final experiment found that when probed to make counterfactual comparisons, also investments that exceed expectations may lead to regret. Together these experiments reveal insights into the comparative processes leading to decision regret.

Many people delay their preparation for retirement. Policy-makers often attempt to motivate people to take timely action by increasing the perceived importance of retirement saving, yet the effectiveness of such strategies can be doubted. We examined why a strategy of emphasizing importance may be ineffective by distinguishing between intention to prepare for retirement and action in actually taking steps toward preparation. Two surveys (n1 = 1171; n2 = 832) showed that importance and difficulty were both predictive of people's intentions to prepare for retirement, but that difficulty was a much stronger predictor of people's actual actions. Using data from an additional survey (n3 = 986), a series of follow-up tests provided further evidence that difficulty of retirement preparation is a stronger predictor of inaction than importance of retirement saving. These findings help explain why policies aimed at simplifying retirement preparation (e.g., automatic enrollment) have been more successful than policies aimed at increasing the importance of retirement saving (e.g., tax advantages).

Behavioral public policies are aimed at influencing the behavior of the public in a way that is advantageous for the public itself and within the law. Sanders, Snijders and Hallsworth (2018, this issue) summarize the state of the art of this new field of study and introduce a number of challenges and opportunities for the time to come. We address an additional challenge that is present and central in all attempts to influence behavior, namely the public – the people that are the target of behavioral public policies. We review evidence revealing that people do not passively accept those influence attempts, but often show reactant responses. We propose that the Persuasion Knowledge Model provides a framework both to understand the reactions of the public and to facilitate communication between academic researchers and practitioners.

Pepper & Nettle describe possible processes underlying what they call a behavioral constellation of deprivation (BCD). Although we are certain about the application of evolutionary models to our understanding of poverty, we are less certain about the utility of behavioral constellations. The empirical record on poverty-related behaviors is much more divergent and broad than such constellations suggest.

When creating alternatives to reality, people often feel emotions in response to these imaginary worlds. I argue that these emotions serve an important purpose. They signal how the world could have been better and prioritize actions to bring this better world about.