M. Solof - Public Affairs Writing & Editing

Driving in traffic, one is often hard-pressed to think of fellow travelers as rational. They swerve across multiple lanes to make a turn, race to get to the next red light, slow to ogle fender-benders and engage in other roadway antics. Yet for the most part transportation planners and policymakers treat drivers— as well as transit riders and other travelers — as basically rational. Given the right rules, signs and signals, it is assumed we will tend to make reasoned and thoughtful choices about where and how we travel.

A growing body of research is concluding otherwise. Researchers are finding that people's bad decisions and behavior involving transportation, health, finances and many other areas of life are often not aberrations. Time and time again, in similar circumstances, people will make the same mistakes and bad choices. "We all have irrational tendencies," Duke University Professor of Behavioral Economics Dan Ariely said. "But these are not random. It is not as if one person behaves irrationally one way and another person behaves irrationally another way." Rather, as Ariely sums it up in the title of his best-selling book, we are Predictably Irrational.

The tendencies have their roots in brain circuitry created by evolution. "Everything we do similarly, we do for a biological reason," he said. Some transportation planners and engineers are beginning to draw upon psychological experiments cataloguing these patterns of behavior —as well as their own experience about real world travel— to find creative ways to discourage roadway antics and other bad travel choices and improve infrastructure design.

Their efforts are part of a wider movement by the new academic discipline of behavioral economics, established in the early 1990s, which is exploring how to factor "the human factor" into the computer models and decision processes used in financial markets, the transportation sector and other fields. There are tantalizing indications these efforts to understand and harness the quirks of human nature can help speed progress towards improved safety, energy efficiency, reduced carbon emissions and achievement of other goals.

Experimental Insights

The experiments into human behavior use games and simplified decision situations, many conducted with college students, to identify patterns of behavior that are likely to mirror real life decision-making. One set of experiments finds that we are irrationally optimistic about our abilities in many situations. Asked to predict their grades in a class at the beginning of the semester, students invariably overrate their performance, with the class skewed towards high achievers. Similarly most drivers in repeated studies rate their skills as better than average (sometimes referred to as the "Lake Woebegone Effect," after radio personality Garrison Keillor's fictional hometown "where all the children are above average").

This can plausibly account for much of the risky and boneheaded behavior on roadways-for instance driving while talking on a cell phone. Drivers think they can beat the odds. They feel, "It's the other person's behavior that needs to be controlled, not mine," Tom Vanderbilt noted in his bestselling book Traffic. Much of drivers' overconfidence stems from an "illusion of control" Ariely said. "When we control something, we feel the risk is lower, even when it is not, and this is especially strong in driving."

Other experiments identify an irrational "loss aversion" we all exhibit in many situations. Students given free mugs demanded substantially more money to give them up than other students, who did not get mugs, were willing to pay for them. That is, we tend to place greater weight on avoiding losses than in realizing gains. There is also the related "endowment effect"— we can be tenacious in holding on to our possessions. These biases likely influence how people drive in many circumstances. In stop-and-go traffic, researchers find drivers inordinately focus on the progress of adjacent lanes to see if they are losing out. They can be tempted to change lanes even when the advantage gained is fleeting. Such behavior, Vanderbilt suggests, can be risky, especially in heavy traffic.

While this may not be the same phenomenon as the loss aversion we experience with objects or money, according to Ariely, "it is related and maybe we use similar brain mechanisms to think about it." Research also suggests that loss aversion can bias our choice of routes, modes and other travel options. We are much more motivated to avoid choices that we perceive might cause losses (in time or money) than we are to adopt choices that promise us savings. Some advocates of congestion pricing have suggested that loss aversion may also account for people's initial, knee-jerk opposition to charging tolls on free roadways.

In his research, Ariely said, loss aversion "is very basic. We don't find people this doesn't happen to." The catalogue of "irrational" behaviors that afflict humans is long and varied (see sidebar ).

Systematic Bias

The most far-reaching implications are in the field of finance and economics. The "irrational exuberance" leading up to the 2008 economic crisis—including herd mentality among investors and overconfidence in
past trends and financial instruments—provided behavioral economists with dramatic evidence about how actual behavior often departs from the rational ideal.

The crisis, they say, has underscored the need for public and private officials to recognize the “bounded rationality” of individuals —that is, the real world limits on the ability of individuals to rein in emotions and avoid cognitive pitfalls that affect decision-making.

Ariely said rational economics is still useful. "The problem is not so much with economics," he said. "The problem is that for some reason we have assumed that [standard] economics is 100 percent accurate . . . and we went a step further and we created systems — the legal system and the banking system — that assume it is 100 percent accurate."

Overconfidence is pervasive in driving and other areas of life. This graph shows how people perceived their abilities on a logical reasoning test compared to their actual score. Those with the least ability showed the greatest overconfidence. While behavioral economics can offer many insights for correcting this assumption, he said, it is not about to supplant standard economics.

"We will probably never have a single theory of human decision-making or of behavioral economics because the brain uses different mechanisms to deal with different problems," he said. Ariely envisions the field becoming "an applied discipline" that offers practical insights to policymakers and directions for creating experiments to improve the effectiveness of existing policies. The approach, he said, is to "acknowledge our limitations… [and] don't assume we understand everything."

Nudges

How can behavioral insights be applied to change the choices wemake in transportation and other areas? Clearly regulation and enforcement, such as banning cell phone use while driving, must play a primary role. But behavioral economists Richard Thaler and Cass Sunstein suggest that subtle interventions ("nudges") that operate at the level of our automatic thinking can often work. Following the publication of their 2008 bestselling book Nudge, the authors launched a blog (nudges.org) to gather and discuss ideas from readers from around the world.world.

The book and blog "sparked a lot of interest among people who make public policy," according to John Barz, Nudge Blog editor and research assistant to the authors at the University of Chicago. "There also has been interest on the private sector side, particularly with large organizations trying to figure out how to help their employees get things done." One category of nudges relates to people's "status quo" bias, that is, our reluctance to change our current circumstances or even take the time to ponder better alternatives. We're all lazy deciders. Balz said people often use a "yeah, whatever" decision-making approach: "[They think] 'I was doing this before. Sure. Yeah, whatever. I'll keep doing it.'"

The default options we’re presented therefore become a powerful force. One nudge blog reader reported that at the company Novo Nordisk, fuel-efficient vehicles were made the default option for sales people. Those who wanted an SUV or minivan could still get one, but they needed approval from a supervisor. Minivan orders dropped from 300-350 per year to 25.

In the field of transportation, the "choice architecture" affecting decisions includes the environment through which people travel, providing a potential focus for nudges to change behavior. For example, to calm traffic entering business or residential districts, many towns use physical changes like narrowed lanes or speed bumps. But nudges involving "psychological traffic-calming" can also work, according to Erel Avineri, reader in travel behavior at the Centre for Transport & Society, University of the West of England. "Rather than humps and bumps and penalties . . . all kinds of changes to the environment-changes to the pavement, to the road surface texture, to street furniture-make it clear to drivers that they are entering a different zone where different rules apply," he said.

In Avineri's town of Bristol, a gatehouse acts as calming nudge for those entering the town center. Some cities have tried transforming the humps and bumps into less intrusive nudges. In Philadelphia, high- tech 3-D decals that create the illusion of speed bumps were installed on the road surface at 100 intersections. On one residential street, average speeds dropped 13 mph after a month. A smaller reduction of 4 mph was found in a previous test in Phoenix. Of course, locals may learn to ignore the illusion over time, but the decals can still serve as a symbolic reminder to slow down.

A perceptional nudge was also used to slow traffic approaching a dangerous curve along Chicago's Lake Shore Drive in 2006. According to nudge.com, "the city painted a series of white lines perpendicular to traveling cars. The lines get progressively narrower as drivers approach the sharpest point of the curve, giving them the illusion of speeding up, and nudging them to tap their brakes." Crashes went down 36 percent in the six months following the intervention, compared to the previous six months.