Making Sense of Uncertainty in Science and Policy

Climate Nudging, Climate Catastrophe and Cost Benefit Analysis

C. Tyler DesRoches (Arizona State University)

Green nudges (GNs) are increasingly popular behavioral interventions aimed at mitigating environmentally mediated harm, particularly in the context of climate change. Examples include default enrollment in renewable energy programs and real-time feedback on energy consumption, designed to promote sustainable behaviors by leveraging behavioral insights and social norms (Thaler and Sunstein 2008; Allcott 2011).

The justification of GNs traditionally relies on cost-benefit analysis (CBA), which quantifies the total costs and benefits, factoring in probabilities to maximize expected utility (Sunstein and Reisch 2013; DesRoches et al. 2023). However, the application of CBA faces significant challenges when GNs involve potential catastrophic outcomes associated with climate change and climate nudging. These include violating basic human rights, potential civilization collapse, and ethical concerns over autonomy and paternalism (Caney 2010; Steel et al. 2022; Berlin 1969).

This talk argues that the qualitative distinction between catastrophic and non-catastrophic outcomes poses a challenge for traditional CBA. While CBA is adept at assessing ordinary costs and benefits, it struggles to accommodate the putative catastrophic outcomes linked to climate change and climate nudging. To address this challenge, this paper considers the lexical precautionary principle (LPP) as a viable decision-making framework for climate nudging. Unlike CBA's decision rule, maximize expected utility, LPP maximizes lexical utility, thereby prioritizing the avoidance of catastrophic outcomes (Bartha and DesRoches 2021; Steel and Bartha 2022).

This talk makes two original contributions to two different literatures, one negative and one positive: the first is to the literature on the ethical permissibility of green nudging. Our claim is that the received view on justifying GNs should be amended for the special case of climate nudging when catastrophic outcomes are at stake. If climate nudging involves the prospect of catastrophic outcomes and CBA cannot handle the distinction between non-catastrophic and catastrophic outcomes, then a decision-making framework that can accommodate such outcomes should be given careful consideration. Second, our talk shows how the LPP can apply to climate nudging, which is a contribution to the theoretical literature on the precautionary principle. We argue that LPP offers a notable advantage over CBA by accommodating the qualitative distinction between catastrophic and non-catastrophic outcomes, even when policymakers disagree or foresee multiple catastrophes.

  • References

    Allcott, H. 2011. Social norms and energy conservation. Journal of Public Economics, 95(9-10), 1082-1095.

    Bartha, Paul and C. Tyler DesRoches. 2021. “Modeling the Precautionary Principle with Lexical Utilities.” Synthese 199, 8701–8740.

    Berlin, Isaiah. 1969. “Two Concepts of Liberty.” In Four Essays on Liberty, 118–172. Oxford: Oxford University Press.

    Caney, Simon. 2010. “Climate Change, Human Rights, and Moral Thresholds,” Climate Ethics: Essential Readings. New York: Oxford Academic.

    DesRoches, C. Tyler, Daniel Fischer, Julia Silver, Philip Arthur, Rebecca Livernois, Timara Crichlow, Gil Hersch, Michiru Nagatsu and Joshua K. Abbott. 2023. “When is Green Nudging Ethically Permissible?” Current Opinion in Environmental Sustainability 60C.101236.

    Steel, Daniel, C. Tyler DesRoches and Kian Mintz-Woo. 2022. “Climate Change and the Threat to Civilization.” Proceedings of the National Academy of the Sciences of the United States of America 119 (42) e2210525119.

    Steel, Daniel, and Paul Bartha. 2022. “Trade-offs and the Precautionary Principle: A Lexicographic Utility Approach.” Risk Analysis. 43 (2): 260-268. 

    Sunstein, Cass R. and Lucia A. Reisch. “Green by Default.” Kyklos 66 (3): 398-402.

    Thaler, R. H., and Sunstein, C. R. 2008. Nudge: Improving Decisions about Health, Wealth, and Happiness. Yale University Press.