If you’re advising people to make better decisions, you’d better give them appealing alternatives to choose from. That’s one takeaway from PhD candidate Alex Ballyk’s behavioural economics research. The Department of Economics’ student explores decision making through experiments at the Toronto Experimental Economics Laboratory (TEEL). In the experiment at the heart of her working paper Paternalistic Persuasion, Ballyk designated participants as experts (called “Advisors”) to try to help a second group of participants (called “Choosers”) to make better decisions by giving them advice. However, persuading Choosers was challenging: Choosers weren’t sure whether all recommendations came from those well-meaning Advisors. Therefore, Advisors needed to send recommendations that Choosers could trust to be in their best interest. [Read more…]