Government behavioural insights teams have tended to apply behavioural insights using the most well-known tools in the field—small, low cost ‘nudges’ to improve communications, increase compliance and enhance the way services are delivered. These tools are applied in a wide range of policy areas. Examples include encouraging more superannuation savings, bringing forward tax payments and improving appointment attendance. This is the ‘low hanging fruit’ of behavioural economics. There is still untapped capacity to apply these tools and achieve wins in public policy.

This paper looks beyond these nudges to identify a smaller set of key policy areas which offer the ability to affect wider scale behavioural change. These “richer veins” are areas where behavioural insights can offer high financial and social impact. Like mining a rich vein for mineral deposits, we consider these areas to offer deep, ongoing opportunity to deliver high value. We have identified three potential areas:

1. Consumer choice (including changing market regulation, disclosure and how information is presented);

2. Financial decision-making (including understanding how people make financial decisions, financial comprehension, how defaults can be used more effectively and how people use mental accounting); and

3. Personal wellbeing (including greater use of price signals, better service delivery and preventative health measures).

To better leverage behavioural economics in these areas, governments could consider turning to “second generation nudges”. These are more ambitious behavioural interventions, targeting systemic and structural solutions.

This paper has been designed as a conversation starter and springboard on how to apply behavioural insights to public policy more strategically. While it nominates three policy areas with high potential for behavioural insights, this is not intended to be an exhaustive list.