Nudger beware: Diagnosis precedes remedy

Nudges are one type of remedy to policy problems. A good nudge preserves choice while using science to change choices in a predictable direction. The originators of the concept argue that this is the preferred approach when applying behavioural economics to policy. The present commentary disputes this stance. Although nudges can be beneficial, behavioural economics is uncovering problems in consumer finance, and perhaps elsewhere, where decisions have serious negative consequences and nudging is an insufficiently strong policy response. This is a specific instance of a general mistake, which is to prioritise one type of remedy before obtaining a proper diagnosis.