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Behavioral Economics

How Behavioral Economics Boosted Tax Compliance in the Dominican Republic

December 18, 2024 by Joaquin Zentner Leave a Comment

In the world of tax collection, even small improvements in compliance can have massive financial implications for governments and societies. A recent study, "The $100 Million Nudge," demonstrates how a simple intervention, rooted in behavioral economics, significantly increased tax compliance among firms, resulting in a dramatic boost to public revenue. Tax compliance has … [Read more...] about How Behavioral Economics Boosted Tax Compliance in the Dominican Republic

Greener Businesses: A Win for Nature and the Economy

September 19, 2024 by Lina Diaz - Carlos Scartascini Leave a Comment

As the effects of climate change intensify around the world, companies are under growing pressure from government regulations, as well as investors and consumers, to move towards more sustainable and eco-friendly practices. A classic example is the European Union's (EU's) Carbon Border Adjustment Mechanism, which entered into a transitional phase in 2023 and will go into … [Read more...] about Greener Businesses: A Win for Nature and the Economy

Improving Road Safety with Behavioral Economics

March 28, 2024 by Indhira Ramirez - Carlos Scartascini Leave a Comment

Road safety behavioral economics Latin America Caribbean

We speed and drive aggressively out of overconfidence, and we disregard commonsense safety measures from too much optimism. We may even use a mobile phone while driving, preferring the short-term convenience of using the phone over greater long-term rewards like safety. We engage, in other words, in time discounting, the tendency to assign a lower value to future rewards than … [Read more...] about Improving Road Safety with Behavioral Economics

When It Comes to Taxes, Gender Matters

March 21, 2024 by Carlos Scartascini Leave a Comment

Tax payments gender Latin America Caribbean

Do women and men behave differently when confronted with taxes? Various studies around the world show that women are more likely than men to pay their taxes, presumably because they are more risk-averse and have greater tax morale, the intrinsic motivation to pay taxes. If that is so, authorities might want to adjust their strategies to take into account gender when trying to … [Read more...] about When It Comes to Taxes, Gender Matters

Inviting Creative Thinkers to Our Free Online Behavioral Economics Course

March 18, 2024 by Karina Márquez - Indhira Ramirez Leave a Comment

Behavioral economics is now firmly established as an essential tool in everything from product design and marketing to education and law enforcement. The realization that people have cognitive biases and often make decisions irrationally is not only an important psychological insight. It has also opened up a whole new area of policy innovations over the last 15 years in which … [Read more...] about Inviting Creative Thinkers to Our Free Online Behavioral Economics Course

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The blog of the IDB's Research Department shares ideas that matter on public policy and development in Latin America and the Caribbean.

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