Behavioural economics and economic policy

• Consumer behaviour can influence the policies that governments employ
• Choice architecture


  The way choices are presented to consumers
• Framing


  The way by which consumers are influenced by the context of how a choice is presented
• Nudges


  Aim to change the behaviour of consumers without taking away their freedom of choice
• Default choice


  When a consumer is automatically enrolled into a system, such as a pension scheme
• Restricted choice


  The choice of the consumer is restricted, but it is still there
• Mandated choice


  Consumers are required to state whether they wish to participate in an action