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Behavioral Design: A New Approach to Development Policy

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  • Saugato Datta
  • Sendhil Mullainathan

Abstract

Successful development programs rely on people to behave and choose in certain ways, and behavioral economics helps us understand why people behave and choose as they do. Approaching problems in development using behavioral economics thus leads to better diagnosis and to better-designed solutions. This paper sketches how to use behavioral insights to design development programs. It distills key insights of behavioral economics into a simple framework about the constraints under which people make decisions.

Suggested Citation

  • Saugato Datta & Sendhil Mullainathan, 2014. "Behavioral Design: A New Approach to Development Policy," WIDER Working Paper Series wp-2014-103, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:wp-2014-103
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