1. 1 Online Gambling and more| Brussels Conference | 30 September 2013 Online gambling and more: potential and limits of policy oriented behavioural experiments G. Gaskell, C. Codagnone, F. Bogliacino, G. Veltri, A. Ivchenko, F. Lupiañez, F. Mureddu APPLYING BEHAVIOURAL INSIGHTS TO POLICY-MAKING: RESULTS, PROMISES AND LIMITATIONS Brussels, 30 September 2013

2. 2 Online Gambling and more| Brussels Conference | 30 September 2013 Look at the two and think which stands a higher chance to influence: A car buyer This one?Or this one? General

3. 3 Online Gambling and more| Brussels Conference | 30 September 2013 Changing mind, changing behaviour General

4. 4 Online Gambling and more| Brussels Conference | 30 September 2013 Multi-dimensional response variables General introducing online gambling

5. 5 Online Gambling and more| Brussels Conference | 30 September 2013 Five reasons why gambling is ‘bad’… and companies/governments profit from it BiasesBrief illustration Gambler’s fallacy The gambler’s fallacy is particular form of representativeness where people rely on the law of small numbers and perceive small samples to represent their population to the same extent as large samples. Near miss fallacy a near miss is a special kind of failure to reach a goal, one that comes close to being successful. Overconfidence effect This is a well known bias in which someone's subjective confidence in their judgments is reliably greater than their objective accuracy, especially when confidence is relatively high Hot and Cold Streaks Some consumers believe in hot and cold streaks, so that they may be more willing to bet after wins and less willing to bet after losses, ignoring the ‘regression to the mean’. Loss Aversion and Reflection On the other hand the reflection effect states that typically gamblers are risk averse for gains, but risk seeking for losses. Zoom on online gambling

6. 6 Online Gambling and more| Brussels Conference | 30 September 2013 … and five key ‘nudges’ we are testing TreatmentTheoretical rationaleExample of test Pop-up pictorial warning message Elicitation of emotionsIs the response on conative variable stronger? Overconfidence Activation of slow but accurate reasoning “reflective thinking”: Is the average bet less risky? Push pop up “You lose” Elicitation of emotions Is the average bet less risky? Fixed monetary limit Default option Are participants less likely to recharge the wallet? Self-defined Monetary limits House money effectIs the average bet lower? Zoom on online gambling

7. 7 Online Gambling and more| Brussels Conference | 30 September 2013 Snapshot of lab experiment design Zoom on online gambling

8. 8 Online Gambling and more| Brussels Conference | 30 September 2013 …how we tested them (1/2) Short video of experiment in practice to be projected and commented We then re-test some of the nudges in a online experiment conducted in 7 countries with a total N= 5600 Zoom on online gambling

9. 9 Online Gambling and more| Brussels Conference | 30 September 2013 Preliminary results IF available by the 30 of September: we will add and comment a few findings in this slide Zoom on online gambling

10. 10 Online Gambling and more| Brussels Conference | 30 September 2013 Nudges: looking beyond Back to general Most nudges and behavioural experiments have been tested only on WEIRD (Western, Educated, Industrialized, Rich and Democratic) people Manipulating restraining and driving ‘forces’ (K. Lewin), the idea behind nudges, also included the social dimension: – Network effects. People are influenced by what other people do: adoption of behaviour is filtered by people’s social networks – Nudges + Network effects. Effective behaviourally-inspired policies have to consider both effective nudges and the social networks through which they can be adopted

11. 11 Online Gambling and more| Brussels Conference | 30 September 2013 Nudge versus deliberation: a normative dispute Back to general NudgeDeliberation SubjectsCognitive misers, bounded rationality and prone to heuristics Reasonable, knowledge hungry and capable of collective reflection Cost to the individualLow but repeatedHigh but only occasional Unit of analysisThe citizenThe group How change happensCost-benefit led shift in choice environment Value led outline of new shared policy platform Civic conceptionIncrease the appeal of positive-sum action Addressing the general interest Role of PolicyCustomize and design choice Create new institutional spaces to support citizen- led investigation, respond to citizens

12. 12 Online Gambling and more| Brussels Conference | 30 September 2013 Less is more … Best experiments make a strong case for design parsimony: reduce the complexity of the real world to the manageable We had to test a lot of treatments in very complex designs: – Lab + online experiment in up to 10 countries (external validity) – Graphic and interactive simulation for realism (ecological validity) – Tight timeline suffering from overconfidence bias: Programming time consuming, changing protocols not like cut and past in simple survey questionnaire Consultation design would be needed in both pre- and post- procurement phase, rephrasing famous quip by Fisher: – “if experimenter is called after the treatments are decided, she can only tell what the experiment will die of” Lessons learnt

13. 13 Online Gambling and more| Brussels Conference | 30 September 2013 … but it’s a complex multi-stakeholder domain The Commission and the Member States … We are not in the much simpler business of running experiment just for one single client – Our presentation to MS representatives in the online gambling expert group: Commission had to ‘rescue’ as after we dared affirm that mere provision of information and Authority’s logo may have no effect whatsoever There is still a long way to go in some countries and/or policy verticals before legacy approaches will be opened to behavioural foundations of policy Regulatory capture by industry still a challenge Lessons learnt

14. 14 Online Gambling and more| Brussels Conference | 30 September 2013 A great opportunity: now it is time to openly share The Commission’s great contribution: – Play a pioneer and catalyser role – Fund studies breaking new grounds and cumulating new evidence In “Open Data Europe” the community of researchers and the general public should not be denied access to such evidence for too long We call on our colleagues/competitors to join forces and set up an online portals where reports, protocols, and dataset are made accessible to researchers and the public at large A final call