CONSUMER POLICY

On 30th September Neven Mimica, EU Commissioner for Consumer Policy, welcomed top international academic, business and policy experts to a conference in Brussels to discuss the role that Behavioural Economics can play in the development of EU policies so as to better serve the consumer.

On 30^th September Neven Mimica, EU Commissioner for Consumer Policy, welcomed top international academic, business and policy experts to a conference in Brussels to discuss the role that Behavioural Economics can play in the development of EU policies so as to better serve the consumer.

Behavioural economics studies how people actually make everyday choices, challenging traditional economic assumptions and relying on field and laboratory experiments to investigate the actual reasons for people's decisions. It may help explain why people's behaviour is not always selfish (e.g., they donate money), why they may not always act in an economically logical way (e.g. staying with a more expensive energy provider rather than changing to a cheaper competitor) or why they prefer some items over others of an equal real value.

The conference focused on examples of where behavioural economics has already led to better policies - both in the EU and elsewhere - and invited debate on its potential use and impact. In particular, the event served to review the experience of policy applications of behavioural insights in UK, France, US, and to present and debate recent initiatives and studies launched by the European Commission.

Commissioner Mimica said: "Effective policies need to build on tools that reflect real consumer behaviour. Behavioural economics could become, in the future, the equivalent to what the "wind tunnel" is for cars: a tool to test, optimise and streamline policies that seek to influence consumers in a wide array of fields, from consumer affairs, to energy, to health, to environment. It offers the opportunity to better understand the anomalies of human behaviour and responses, so that policies can be shaped to best suit consumers' needs".

This policy "wind tunnel" has already been used by the European Commission, for example during the work on the Consumer Rights Directive. More specifically, behavioural insights underpinned the regulation of so-called pre-checked boxes (art. 22, on ancillary services). Based on the studies carried out for the European Commission and presented at the Conference there is considerable scope for behavioural insights to inform consumer policy in many areas, from financial services to on-line shopping.