Revolutionizing Regulation: Using Nudges to Maximize Social Welfare Impact
Behavioral science can help improve regulations by using nudges in Impact Assessment. Different methods like BASIC and FEAST have been developed to check the effectiveness of nudges. Nudges are based on behavioral economics, which goes beyond the assumption of rationality. When evaluating the cost and benefit of nudges, traditional neoclassical criteria should be used to compare with other measures and economic incentives. The goal is to maximize social welfare in Impact Assessment.