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Incentive structures can drive behavior in unexpected ways from "summary" of Alchemy by Rory Sutherland
The way in which you frame a decision can have a profound impact on the choices people make. By altering the incentive structure, you can nudge people towards a particular option, even if they are unaware of the influence. This is because our decisions are often guided by subconscious cues and biases, rather than rational analysis. For example, consider the difference between opt-in and opt-out systems. When faced with a choice, people are more likely to stick with the default option. By making a certain behavior the default choice, you can significantly influence the decisions people make. This is why organ donation rates vary dramatically between countries with opt-in and opt-out systems. Similarly, the way in which re...
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