ESRI Policy Seminar - "Regulatory Policy and Behavioural Economics: What’s Happening in OECD Countries?”

Venue: ESRI, Whitaker Square, Sir John Rogerson's Quay, Dublin 2

Speaker: Pete Lunn

Over the past five years, behavioural economics has been rapidly propelled from the margins of economic analysis towards the policy mainstream. In this context, the present paper offers an international review of the initial applications of behavioural economics to policy, with a particular focus on regulatory policy. It describes the extent to which behavioural findings have begun to influence public policy in a number of OECD countries, referring to a total of more than 60 instances, the majority of which concern regulatory policy. The review highlights those policy areas where behavioural economics is having its greatest impact and discusses the most common types of behaviourally informed policy design. The analysis then identifies a number of themes and challenges that arise for regulatory design and, to a lesser extent, regulatory delivery. The paper concludes that behavioural economics is changing not only how policy is designed, but also the methods used to design it. Behaviourally informed policies tend to be developed through a more empirical and inductive approach to economic analysis than has been common in recent decades.