Double-edged nudges? micro-foundations to behavioural interventions and their spillover effects

Nudges are popular instruments in the toolbox of policymakers. Yet, empirical evidence suggests some of these interventions can influence decisions which were not initially targeted, raising the risk to undermine their effectiveness. To analyse such spillover effects, I develop micro-foundations to nudges that either increase preference for consistency, the salience of social norms, or one's motivation to achieve results. Interventions triggering a preference for consistency maximise these spillover effects. Yet, this model suggests that such nudges should not always be preferred when the main criteria is to maximise their direct effects. In this model individuals decide to consume for a given motive (e.g., eating less meat for the environment) based on other decisions undertaken for the same motive (e.g., buying organic food for the environment). They can either perceive these decisions as complementary or substitutable to achieve the goal associated to the motive they are undertaken for. When they perceive these decisions as substitutable, nudges triggering a preference for consistency or/and increasing the salience of social norms are always less effective than other nudges. When individuals perceive them as complements, such nudges dominate any other interventions. Based on this model, I provide guidelines to estimate behavioural spillovers and interpret them in order to determine the causal mechanisms at play when using behavioural interventions