The ATO conducted a random trial covering 20,000 individuals and businesses and it included two different messages being sent out.
👉 Background: Every year the ATO handles about 43 million tax returns and business activity statements (BAS). But here’s the thing: almost a quarter of those 43 million returns are not completed on time.
👉 What happened: Last year, the ATO was desperate to find ways to get people to submit tax returns on time. So, they conducted a random trial covering 20,000 individuals and businesses and it included two different messages being sent out.
👉 What else: The trial found that whose who received the tougher message were 40% more likely to submit their returns... and it shows how these little behavioural nudges can make such a big difference.
💡Nudge theory is a concept in behavioural economics. The idea is that subtle interventions can help people make better decisions.
💡Nudges have become an effective way for the public sector to encourage good, civic behaviour:
💡But this ain’t only helpful for the public sector. Many tech businesses have adopted the nudge theory too. For example, Amazon's "Frequently Bought Together" feature uses nudge theory to encourage users to buy related products
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