1 00:00:03,960 --> 00:00:06,420 Sean Aylmer: Welcome to the Fear and Greed Daily interview. I'm Sean 2 00:00:06,420 --> 00:00:09,450 Sean Aylmer: Aylmer. Every day we are talking about the rising cost 3 00:00:09,450 --> 00:00:13,830 Sean Aylmer: of living, interest rates, power bills, grocery prices, petrol. Households 4 00:00:13,830 --> 00:00:16,800 Sean Aylmer: are being hit hard and it's not over yet. Are 5 00:00:16,800 --> 00:00:20,279 Sean Aylmer: there any solutions to the crisis? Well, yesterday Commonwealth Bank 6 00:00:20,579 --> 00:00:23,520 Sean Aylmer: brought together a panel to look at how behavioral science 7 00:00:23,760 --> 00:00:26,970 Sean Aylmer: can help. I'm joined by two of the panelists today, 8 00:00:27,210 --> 00:00:31,740 Sean Aylmer: Commonwealth Bank, Chief Behavioural Scientist, William Mailer, and Professor David 9 00:00:31,740 --> 00:00:37,440 Sean Aylmer: Halpern, the CEO of the UK's Behavioural Insights Team, the Nudge Unit established in 10 00:00:37,440 --> 00:00:41,100 Sean Aylmer: 2010 to advise the UK government on applying behavioral science 11 00:00:41,370 --> 00:00:44,370 Sean Aylmer: to public policy. William, David, welcome to Fear and Greed. 12 00:00:44,580 --> 00:00:45,510 David Halpern: Hi, nice to you. 13 00:00:45,750 --> 00:00:46,440 William Mailer: Thank you for having us. 14 00:00:47,190 --> 00:00:50,699 Sean Aylmer: Okay, so before I get into it, let's start with 15 00:00:50,700 --> 00:00:54,960 Sean Aylmer: definition. What exactly is behavioral science? 16 00:00:55,470 --> 00:00:57,810 David Halpern: Right. Well, maybe I should lead off on that one. It's basically 17 00:00:57,810 --> 00:01:02,580 David Halpern: trying to systematically understand what drives our behavior, our decisions, 18 00:01:02,580 --> 00:01:04,500 David Halpern: and so on. It might seem like, oh, well we 19 00:01:04,500 --> 00:01:06,720 David Halpern: just kind of know that we're human beings, but we've 20 00:01:06,720 --> 00:01:09,660 David Halpern: learned a lot in the last, not just 10, 20 years, 21 00:01:09,660 --> 00:01:12,720 David Halpern: but over the last century, where we can more systematically 22 00:01:12,720 --> 00:01:16,319 David Halpern: understand, for example, the mental shortcuts that drive our behavior, 23 00:01:16,620 --> 00:01:18,840 David Halpern: and help to explain some of the puzzles. Why is 24 00:01:18,840 --> 00:01:22,140 David Halpern: it we never get to the gymnasium, and why do we eat 25 00:01:22,140 --> 00:01:24,060 David Halpern: less healthily than we should do, and why don't we 26 00:01:24,060 --> 00:01:26,819 David Halpern: save more money? And actually that we can understand ourselves 27 00:01:26,819 --> 00:01:29,280 David Halpern: on the way in which our mental shortcuts that drive 28 00:01:29,280 --> 00:01:32,670 David Halpern: our behavior, essentially, you can use that for good or for bad. 29 00:01:33,150 --> 00:01:36,209 Sean Aylmer: Okay, David, keep going on this. And it's not just 30 00:01:36,209 --> 00:01:39,930 Sean Aylmer: a societal issue, it's become a sort of function of 31 00:01:39,930 --> 00:01:41,580 Sean Aylmer: economics as well, hasn't it? 32 00:01:42,780 --> 00:01:48,600 David Halpern: Very much so, yes. A lot of economic models were 33 00:01:48,600 --> 00:01:52,440 David Halpern: based on some notion of people were fully rational, we 34 00:01:52,440 --> 00:01:55,230 David Halpern: got all perfect information, we can make perfect decisions, but 35 00:01:55,230 --> 00:01:58,740 David Halpern: as we know, that's pretty unrealistic. And particularly the work 36 00:01:58,740 --> 00:02:01,590 David Halpern: of Danny Conneman and others starting from, well, actually even 37 00:02:01,590 --> 00:02:06,570 David Halpern: in the 70s and 80s, reincorporated into economics to make a more 38 00:02:06,570 --> 00:02:09,780 David Halpern: realistic model of what actually drives our behavior. So in 39 00:02:09,780 --> 00:02:12,570 David Halpern: particular, we tend to think, I mean, Danny Conneman famously 40 00:02:12,570 --> 00:02:15,780 David Halpern: popularized through the notion of thinking fast and thinking slow, 41 00:02:15,780 --> 00:02:19,410 David Halpern: that most of the decisions aren't perfectly weighed. Most of 42 00:02:19,410 --> 00:02:21,360 David Halpern: the decisions we make as we run around our lives, 43 00:02:21,360 --> 00:02:25,230 David Halpern: busy doing things, often using relatively fast thinking, which works 44 00:02:25,230 --> 00:02:27,299 David Halpern: a lot of the time, the mental shortcut, but sometimes 45 00:02:27,300 --> 00:02:28,709 David Halpern: trips us up and makes errors. 46 00:02:28,980 --> 00:02:32,430 Sean Aylmer: Okay. William, bringing you into this, why does a bank like 47 00:02:32,430 --> 00:02:36,180 Sean Aylmer: the Commonwealth Bank need a Chief Behavioural Scientist? I think 48 00:02:36,180 --> 00:02:38,400 Sean Aylmer: David's probably partly answered that question, but I want to 49 00:02:38,400 --> 00:02:38,940 Sean Aylmer: hear from you. 50 00:02:40,080 --> 00:02:42,540 William Mailer: Yeah, absolutely. So I think picking up on what David 51 00:02:42,540 --> 00:02:46,080 William Mailer: was saying, we may have these great goals of saving 52 00:02:46,080 --> 00:02:49,020 William Mailer: more for retirement or spending less, but then we go 53 00:02:49,020 --> 00:02:50,610 William Mailer: out in the day to day world and we can 54 00:02:50,610 --> 00:02:52,889 William Mailer: behave and spend in ways that actually work against those 55 00:02:52,889 --> 00:02:55,620 William Mailer: goals. So the first part is understanding why, and I 56 00:02:55,620 --> 00:02:58,019 William Mailer: think that's a lot of the science and the history 57 00:02:58,020 --> 00:03:00,990 William Mailer: around the behavioral sciences. But the second part for a 58 00:03:00,990 --> 00:03:02,639 William Mailer: team like mine is then, well, what do you do 59 00:03:02,639 --> 00:03:06,150 William Mailer: with that? And how do you design better products, information, 60 00:03:06,540 --> 00:03:09,869 William Mailer: tools, services that actually help customers stick to those goals, 61 00:03:10,200 --> 00:03:13,230 William Mailer: and get there more easily, and make better decisions, and 62 00:03:13,230 --> 00:03:15,690 William Mailer: have less regret around what they've spent or how little 63 00:03:15,690 --> 00:03:16,380 William Mailer: they've saved. 64 00:03:16,590 --> 00:03:18,990 Sean Aylmer: Okay. So I mean, think this is going to be a 65 00:03:18,990 --> 00:03:21,600 Sean Aylmer: good conversation, David, because in a sense you can give 66 00:03:21,600 --> 00:03:23,730 Sean Aylmer: us the big picture, and William, you can tell us 67 00:03:23,880 --> 00:03:26,579 Sean Aylmer: how it does apply to real life via the Commonwealth 68 00:03:26,580 --> 00:03:29,490 Sean Aylmer: Bank, in a sense. The cost of living, we're all 69 00:03:29,490 --> 00:03:32,160 Sean Aylmer: talking about it at the moment, and obviously energy prices 70 00:03:32,160 --> 00:03:35,700 Sean Aylmer: are high, mortgage repayments are much higher, as are fruit 71 00:03:35,700 --> 00:03:37,830 Sean Aylmer: and veggies in Australia due to floods, things like that, 72 00:03:38,070 --> 00:03:43,890 Sean Aylmer: are much higher. How can behavioral science work in terms 73 00:03:43,890 --> 00:03:48,059 Sean Aylmer: of alleviating cost of living pressures, perhaps starting with you, David? 74 00:03:48,330 --> 00:03:51,750 David Halpern: Sure. Well, behavioral science isn't going to suddenly lower the 75 00:03:51,750 --> 00:03:54,660 David Halpern: energy price or stop the war in Ukraine. Or maybe 76 00:03:54,660 --> 00:03:57,839 David Halpern: it could, that would be good, but people often reach to, " 77 00:03:58,440 --> 00:04:00,390 David Halpern: What are the things you can do? Can you teach 78 00:04:00,390 --> 00:04:04,680 David Halpern: people to have more financial skills and literacy and so 79 00:04:04,680 --> 00:04:06,360 David Halpern: on?" You can do a certain amount of that, but 80 00:04:06,360 --> 00:04:08,760 David Halpern: actually what often you can really do, is you can 81 00:04:08,760 --> 00:04:11,610 David Halpern: make the world, for example, more legible. So it's easier 82 00:04:11,610 --> 00:04:14,820 David Halpern: to understand, to take the friction out so that people, 83 00:04:14,850 --> 00:04:17,430 David Halpern: for example, where there's money on the table in relation 84 00:04:17,430 --> 00:04:22,020 David Halpern: to energy specifically, many countries now have subsidies, but many 85 00:04:22,020 --> 00:04:25,049 David Halpern: people aren't claiming them, which seems weird and paradoxical and 86 00:04:25,050 --> 00:04:27,870 David Halpern: often because there's kind of frictional barriers that get in 87 00:04:27,870 --> 00:04:30,870 David Halpern: the way, and they turn out to be really important. So, 88 00:04:31,890 --> 00:04:35,400 David Halpern: in other domains, it would be nice to run faster, 89 00:04:35,400 --> 00:04:37,529 David Halpern: et cetera, and you can train people to run a 90 00:04:37,529 --> 00:04:39,539 David Halpern: bit faster. But in the end it's like, " Well, why 91 00:04:39,540 --> 00:04:41,520 David Halpern: don't we give someone a bicycle?" What can we do that 92 00:04:42,060 --> 00:04:44,460 David Halpern: kind of aids essentially, which means we can be more 93 00:04:44,460 --> 00:04:46,979 David Halpern: effective? So a lot of the paper science, not as 94 00:04:46,980 --> 00:04:50,070 David Halpern: only just aimed, as it were, beckon inside ourselves to 95 00:04:50,070 --> 00:04:52,469 David Halpern: be more effective in decision making, but it's to make 96 00:04:52,470 --> 00:04:55,620 David Halpern: a world with which it is easier to make good decisions. 97 00:04:56,160 --> 00:05:01,260 Sean Aylmer: And within the Commonwealth Bank then, Will, is the bank 98 00:05:01,260 --> 00:05:05,070 Sean Aylmer: itself making changes? Are you seeing changed behavior by consumers 99 00:05:05,070 --> 00:05:06,839 Sean Aylmer: that you think, oh, we can react to that to 100 00:05:06,839 --> 00:05:08,250 Sean Aylmer: actually take some of that friction out? 101 00:05:09,480 --> 00:05:11,160 William Mailer: Yeah, I think in a lot of ways we've been 102 00:05:11,160 --> 00:05:13,080 William Mailer: looking at this for quite a long time, but it's 103 00:05:13,080 --> 00:05:15,419 William Mailer: never been more important than it is, I think, in 104 00:05:15,420 --> 00:05:18,719 William Mailer: the current climate. So David and I were talking the 105 00:05:18,720 --> 00:05:21,060 William Mailer: other day about the idea of inertia. So we've all 106 00:05:21,060 --> 00:05:23,370 William Mailer: probably got a whole bunch of subscriptions that are just 107 00:05:23,670 --> 00:05:27,330 William Mailer: ticking away in the background, and debiting our account. And 108 00:05:27,330 --> 00:05:30,060 William Mailer: because of our human limitations, we probably don't review that 109 00:05:30,060 --> 00:05:32,549 William Mailer: every day, and we don't make those decisions all the 110 00:05:32,550 --> 00:05:36,539 William Mailer: time. And inertia means we get stuck in these habits, 111 00:05:36,540 --> 00:05:39,540 William Mailer: and sometimes we need a reminder or a tool that 112 00:05:39,540 --> 00:05:42,120 William Mailer: helps us address that. So the Commonwealth Bank will provide 113 00:05:42,150 --> 00:05:44,729 William Mailer: you all of your recurring payments in one spot, that 114 00:05:44,730 --> 00:05:47,849 William Mailer: you can easily look at and change. A big area 115 00:05:47,850 --> 00:05:50,700 William Mailer: we've been looking at is the huge amount of unclaimed 116 00:05:50,700 --> 00:05:54,240 William Mailer: government benefits and services that are available to people, and 117 00:05:54,270 --> 00:05:57,480 William Mailer: how do you reduce the social stigma, increase the awareness, 118 00:05:57,480 --> 00:06:00,419 William Mailer: and reduce the barriers, for people that just have busy 119 00:06:00,450 --> 00:06:03,270 William Mailer: lives and probably don't have the time to go through 120 00:06:03,270 --> 00:06:05,820 William Mailer: all the forms and paperwork to get to those benefits. 121 00:06:06,510 --> 00:06:09,989 William Mailer: A final example I'll give you is this idea that 122 00:06:09,990 --> 00:06:12,720 William Mailer: we may want to do something tomorrow, but when tomorrow 123 00:06:12,720 --> 00:06:15,870 William Mailer: comes, we just don't follow through. And this is a 124 00:06:15,900 --> 00:06:19,080 William Mailer: pattern that the behavioral sciences have showed over and over 125 00:06:19,080 --> 00:06:22,500 William Mailer: again with human behavior. So we look at tax refunds, 126 00:06:22,500 --> 00:06:25,470 William Mailer: for example, here at the Commonwealth Bank. People may want 127 00:06:25,470 --> 00:06:27,630 William Mailer: to put that to savings or debt when it arrives 128 00:06:27,630 --> 00:06:29,520 William Mailer: in six months time, but then when the money hits 129 00:06:29,520 --> 00:06:32,130 William Mailer: the account, we spend it in different ways. We may 130 00:06:32,130 --> 00:06:34,799 William Mailer: feel good or bad about that. So we developed a 131 00:06:34,800 --> 00:06:38,700 William Mailer: service again that works with human behavior, helps customers to 132 00:06:38,700 --> 00:06:42,479 William Mailer: lock in that good intention ahead of time. And then 133 00:06:42,480 --> 00:06:45,390 William Mailer: when the money arrives, it's already been applied in the 134 00:06:45,390 --> 00:06:48,210 William Mailer: way that people intended it to, and we take that 135 00:06:48,210 --> 00:06:50,610 William Mailer: temptation away to spend it in other ways. 136 00:06:51,000 --> 00:06:59,460 Sean Aylmer: Stay with me, we'll be back in a minute... My 137 00:06:59,460 --> 00:07:03,390 Sean Aylmer: guests today are Commonwealth Bank, Chief Behavioural Scientist William Mailer, 138 00:07:03,600 --> 00:07:07,830 Sean Aylmer: and Professor David Halpern, CEO of the UK's Behavioral Insights 139 00:07:07,830 --> 00:07:10,800 Sean Aylmer: Team. I'm trying to work out, Will, whether it's about 140 00:07:11,160 --> 00:07:16,679 Sean Aylmer: changing consumer behavior, or kind of better implementing what they 141 00:07:16,680 --> 00:07:18,630 Sean Aylmer: want to do, or they say they wanted to. 142 00:07:20,250 --> 00:07:23,160 William Mailer: Exactly right. I think a lot of what we're doing 143 00:07:23,160 --> 00:07:26,970 William Mailer: is actually just removing barriers and helping people to get 144 00:07:26,970 --> 00:07:29,820 William Mailer: to where they want to go. The world's an incredibly 145 00:07:29,820 --> 00:07:34,080 William Mailer: busy and noisy place. Decisions are very complex, and sometimes 146 00:07:34,080 --> 00:07:37,650 William Mailer: important information's hard to find. So the easier we can 147 00:07:37,650 --> 00:07:40,260 William Mailer: make it for customers to get to their goals in 148 00:07:40,260 --> 00:07:42,630 William Mailer: the way that they want to, and remove those behavioral 149 00:07:42,630 --> 00:07:45,300 William Mailer: barriers, that's kind of the plan here. 150 00:07:45,690 --> 00:07:48,120 Sean Aylmer: Yeah, I mean obviously the Commonwealth Bank is doing it, 151 00:07:48,450 --> 00:07:52,080 Sean Aylmer: and David, you've done work with banks overseas also Downing 152 00:07:52,080 --> 00:07:55,679 Sean Aylmer: Street, you mentioned. What about local governments here, plural, as 153 00:07:55,680 --> 00:07:59,010 Sean Aylmer: in state governments, local governments and federal government? Is it 154 00:07:59,010 --> 00:08:02,250 Sean Aylmer: something that they're thinking about? Maybe that is for Will 155 00:08:02,250 --> 00:08:03,360 Sean Aylmer: or David, either of you? 156 00:08:04,350 --> 00:08:06,600 David Halpern: Well, some are. I mean, actually here in New South 157 00:08:06,600 --> 00:08:08,760 David Halpern: Wales you have the fantastic Victor Dominello, who I think 158 00:08:08,760 --> 00:08:12,900 David Halpern: has been a great champion and quite government- side trying, 159 00:08:12,900 --> 00:08:17,520 David Halpern: how can you benefit finders type thing. I'm a big 160 00:08:17,520 --> 00:08:20,100 David Halpern: fan of what the Commonwealth Bank have been doing, is, " Well 161 00:08:20,100 --> 00:08:23,280 David Halpern: actually, who else is out there that you're using regularly 162 00:08:23,520 --> 00:08:25,860 David Halpern: that actually can proactively help you?", rather than you have 163 00:08:25,860 --> 00:08:29,160 David Halpern: to go somewhere else to find this. Just a tiny 164 00:08:29,160 --> 00:08:34,020 David Halpern: bit of background, I've looked at both with banks and 165 00:08:34,020 --> 00:08:37,410 David Halpern: often with regulators in a number of places, and banks 166 00:08:37,410 --> 00:08:40,260 David Halpern: have a bit of a decision. Are they there to 167 00:08:40,620 --> 00:08:43,170 David Halpern: use behavioral science to work out just how much they 168 00:08:43,170 --> 00:08:45,360 David Halpern: can get away with charging you, and sneak an extra 169 00:08:45,360 --> 00:08:47,370 David Halpern: thing in, when you do your exchange, whatever it would 170 00:08:47,370 --> 00:08:50,189 David Halpern: be? Or are they there actually to help you out, 171 00:08:50,580 --> 00:08:53,099 David Halpern: and help you find a better product or connect you 172 00:08:53,370 --> 00:08:56,490 David Halpern: with a benefit or to point out... Yeah, I mean 173 00:08:56,580 --> 00:08:59,010 David Halpern: the average American, for example, has between a $ 100 and $ 174 00:09:00,059 --> 00:09:04,439 David Halpern: 150 a month on subscriptions, and nearly half of them 175 00:09:04,440 --> 00:09:07,500 David Halpern: have subscriptions which they thought they'd canceled. But your bank 176 00:09:07,500 --> 00:09:09,270 David Halpern: is perfectly placed to say, " Oh by the way, do 177 00:09:09,270 --> 00:09:12,090 David Halpern: you still want all these things?" You'd click here, make 178 00:09:12,090 --> 00:09:14,160 David Halpern: it easy. So it could be done by government, but 179 00:09:14,160 --> 00:09:17,309 David Halpern: often there's someone else you're already engaging with, with respect 180 00:09:17,309 --> 00:09:19,140 David Halpern: to your financial behavior, who's not government. 181 00:09:20,730 --> 00:09:24,360 Sean Aylmer: Okay. Yeah, I mean, banks get a bad run from 182 00:09:24,360 --> 00:09:27,689 Sean Aylmer: we in the media, no doubt about it, but I'm sure 99. 183 00:09:27,690 --> 00:09:29,849 Sean Aylmer: 9% of bankers are actually there for customers trying to 184 00:09:29,850 --> 00:09:33,000 Sean Aylmer: do the right thing. Commonwealth Bank and your competitors as 185 00:09:33,000 --> 00:09:35,880 Sean Aylmer: well, this seems to me to be a fairly tangible 186 00:09:36,390 --> 00:09:37,860 Sean Aylmer: way of doing it, Will. 187 00:09:38,550 --> 00:09:43,170 William Mailer: Absolutely. And we're very much an empirical team, so we're 188 00:09:43,590 --> 00:09:46,530 William Mailer: constantly measuring and testing what we're doing, and trying to 189 00:09:46,530 --> 00:09:48,840 William Mailer: understand the impact we're having for our customers and for 190 00:09:48,840 --> 00:09:52,200 William Mailer: the business. We're a team of around 20. Within the 191 00:09:52,200 --> 00:09:56,730 William Mailer: team we've got a mix of psychologists, economists, data scientists, 192 00:09:56,730 --> 00:10:00,300 William Mailer: and designers. We work very closely with the AI professionals 193 00:10:00,300 --> 00:10:04,350 William Mailer: within the bank, as well as obviously the product teams 194 00:10:04,350 --> 00:10:08,910 William Mailer: and the digital service teams. So it's really behavioral science, 195 00:10:08,910 --> 00:10:13,260 William Mailer: and applied behavioral science, particularly, is very multidisciplinary in nature. 196 00:10:13,559 --> 00:10:16,619 William Mailer: We also partner very closely with research groups around the 197 00:10:16,620 --> 00:10:21,480 William Mailer: world, community groups to understand what's the most important financial 198 00:10:21,480 --> 00:10:25,020 William Mailer: wellbeing and behavioral problem today, as well as government, as 199 00:10:25,020 --> 00:10:27,960 William Mailer: you mentioned, and the behavioral units within government. 200 00:10:28,830 --> 00:10:31,350 Sean Aylmer: David, where does this go? So I mean, behavioral science 201 00:10:31,350 --> 00:10:34,800 Sean Aylmer: isn't new, but in terms of applying it in a 202 00:10:34,800 --> 00:10:37,680 Sean Aylmer: business sense or a government sense, it's not that old 203 00:10:37,920 --> 00:10:41,580 Sean Aylmer: either. My background is in economics, I've done a bit of behavioral economics, and 204 00:10:41,580 --> 00:10:43,650 Sean Aylmer: at end of the day, if you incentivize someone to 205 00:10:43,650 --> 00:10:45,870 Sean Aylmer: do it, they do it. It's kind of as simple 206 00:10:45,870 --> 00:10:49,500 Sean Aylmer: as that, I think. Surely there's a long way forward 207 00:10:49,500 --> 00:10:53,130 Sean Aylmer: to go, not just in banking, but in retail and 208 00:10:53,130 --> 00:10:58,530 Sean Aylmer: potentially in mining, to introduce behavioral science to get more 209 00:10:58,530 --> 00:10:59,430 Sean Aylmer: efficient outcomes. 210 00:11:00,750 --> 00:11:02,939 David Halpern: Yeah, I mean, a key question is, " what is there 211 00:11:02,940 --> 00:11:06,601 David Halpern: beyond incentives?" You're a good, well trained economist there, but 212 00:11:06,601 --> 00:11:08,550 David Halpern: it turns out there's lots of other things which matter 213 00:11:08,550 --> 00:11:12,719 David Halpern: too. The way in which you say something or do something, even the effectiveness 214 00:11:12,720 --> 00:11:15,120 David Halpern: of companies, often to do with the personal dynamics and 215 00:11:15,120 --> 00:11:18,090 David Halpern: how they operate. Incidentally, often the way of motivating your 216 00:11:18,090 --> 00:11:20,160 David Halpern: workers, for example, is not just to use money. In 217 00:11:20,160 --> 00:11:22,920 David Halpern: fact, often it's not particularly effective, much better off to say, " 218 00:11:22,980 --> 00:11:25,740 David Halpern: God, you did a great job." You know, human beings, 219 00:11:25,950 --> 00:11:28,620 David Halpern: eh? So it's getting us into that world. Oh, I 220 00:11:28,620 --> 00:11:30,929 David Halpern: do think Commonwealth Bank are quite positive about what they're 221 00:11:30,929 --> 00:11:33,030 David Halpern: doing. I think that they stand out. A lot of 222 00:11:33,690 --> 00:11:36,240 David Halpern: big banks are still basically stuck with rent seeking, but 223 00:11:36,960 --> 00:11:39,059 David Halpern: there're also some challenger banks who are kind of pushing 224 00:11:39,059 --> 00:11:43,350 David Halpern: the frontiers too. So an example would be other parts 225 00:11:43,350 --> 00:11:47,670 David Halpern: of expenditure. If you want to stop yourself gambling, why 226 00:11:47,670 --> 00:11:50,760 David Halpern: couldn't you say to your bank, " For God's sake, I don't want to 227 00:11:50,760 --> 00:11:54,000 David Halpern: gamble anymore." Or even other kinds of shopping. There are 228 00:11:54,000 --> 00:11:57,330 David Halpern: people, actually most people, but especially people that have mental 229 00:11:57,330 --> 00:11:58,979 David Halpern: health issues, if you're up in the middle of the 230 00:11:58,980 --> 00:12:01,950 David Halpern: night buying stuff online, how many people think that they 231 00:12:01,950 --> 00:12:04,050 David Halpern: bought something between the hours of one o'clock in the 232 00:12:04,050 --> 00:12:06,540 David Halpern: morning and six o'clock in the morning, and then afterword 233 00:12:06,540 --> 00:12:09,540 David Halpern: thought that was great? So you might want to say, 234 00:12:10,559 --> 00:12:12,540 David Halpern: can I just set it so I literally can't buy 235 00:12:12,540 --> 00:12:15,000 David Halpern: anything in those hours? And then you get into the 236 00:12:15,000 --> 00:12:17,309 David Halpern: psychology of what happens when you change your mind? And 237 00:12:17,309 --> 00:12:19,290 David Halpern: how does the bank handle that, so you might design 238 00:12:19,590 --> 00:12:22,350 David Halpern: what are called commitment devices, where you'd say, " You know 239 00:12:22,350 --> 00:12:24,450 David Halpern: what, if I change my mind, I have to say 240 00:12:24,450 --> 00:12:27,569 David Halpern: like, 'I'm a gambler again. Yes, I want to spend all my kids' 241 00:12:27,570 --> 00:12:30,000 David Halpern: money, and I'm a bad parent, and I'll write that 242 00:12:30,000 --> 00:12:33,330 David Halpern: out five times.'" You said it to yourself, or a text 243 00:12:33,330 --> 00:12:35,970 David Halpern: goes to your mum saying, " Actually, I've decided that I 244 00:12:35,970 --> 00:12:39,720 David Halpern: do want to start gambling again." They're slightly playful examples, 245 00:12:39,720 --> 00:12:42,600 David Halpern: but they're not entirely. How do you get to design, 246 00:12:42,870 --> 00:12:45,840 David Halpern: as it were, the commitment device for yourself, which then 247 00:12:46,140 --> 00:12:48,869 David Halpern: tallies with the financial provider? But you're right, can it 248 00:12:48,870 --> 00:12:51,570 David Halpern: be applied? I mean almost every issue which we face 249 00:12:51,720 --> 00:12:55,920 David Halpern: in policy certainly, involves human behavior. Our health behavior, we 250 00:12:56,250 --> 00:12:58,500 David Halpern: lose on average 10 years of life, nearly all for 251 00:12:58,710 --> 00:13:02,040 David Halpern: health and lifestyle factors. Saving the planet. The estimate is 252 00:13:02,370 --> 00:13:04,620 David Halpern: it's nearly two thirds of what we have to do 253 00:13:04,620 --> 00:13:07,829 David Halpern: in relation to achieve net zero involves behavior change, either 254 00:13:07,830 --> 00:13:10,440 David Halpern: because we have to change, eat less red meat, whatever, 255 00:13:10,440 --> 00:13:12,690 David Halpern: or we have to adopt new kinds of technology, so 256 00:13:12,690 --> 00:13:15,809 David Halpern: on and so on. So getting people back to employment, or a 257 00:13:15,809 --> 00:13:18,960 David Halpern: famous example of mine we used to talk about was, it's pretty hard 258 00:13:18,960 --> 00:13:22,770 David Halpern: to pass a law in Congress or in Canberra, wherever, 259 00:13:23,040 --> 00:13:25,200 David Halpern: and to get kids to turn off the TV and do 260 00:13:25,200 --> 00:13:28,709 David Halpern: their homework. Most stuff, when you look at it, involves 261 00:13:28,710 --> 00:13:32,340 David Halpern: human behavior. And the weird thing is, for policy makers, 262 00:13:32,610 --> 00:13:34,020 David Halpern: why the hell didn't we get that earlier? 263 00:13:35,100 --> 00:13:38,760 Sean Aylmer: Yeah. Yeah, yeah. Plenty to think about. William, David, thank 264 00:13:38,760 --> 00:13:40,050 Sean Aylmer: you for talking to Fear and Greed. 265 00:13:41,460 --> 00:13:41,611 David Halpern: Thank you. 266 00:13:41,611 --> 00:13:42,150 William Mailer: Thank you very much. 267 00:13:42,690 --> 00:13:46,380 Sean Aylmer: That was Commonwealth Bank Chief Behavioural Scientist, William Mailer, and 268 00:13:46,380 --> 00:13:50,939 Sean Aylmer: Professor David Halpern, CEO of the UK's Behavioral Insights Team. 269 00:13:51,210 --> 00:13:53,250 Sean Aylmer: This is the Fear and Greed Daily Interview. Join us 270 00:13:53,280 --> 00:13:55,439 Sean Aylmer: every morning for the full episode of Fear and Greed, 271 00:13:55,440 --> 00:13:59,219 Sean Aylmer: Australia's most popular business podcast. I'm Sean Aylmer. Enjoy your day.