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Direction : Read the passage carefully and answer the questions that follow.
‘When dealing with people, remember you are not dealing with creatures of logic, but with creatures of emotion, creatures with prejudice and motivated by pride and vanity.’ Throughout its history, humankind has been motivated to war, terrorism, ethnic cleansing, genocide, racist hysteria, religious intolerance and extremism, mass suicide and many other forms of irrational and pathological behaviour. The problem arises as Milan Kundera defines it, when we ask that terrible anthropological question – ‘What are people capable of’? Governments seek to regulate or influence the behaviour of individuals and organisations through a range of policy tools, including legislation, sanctions, regulations, taxes and subsidies, the provision of public services and information and guidance material. There is a growing range of complex policy areas, so-called ‘wicked’ problems, where it has become increasingly clear that government cannot simply ‘deliver’ key policy outcomes to a disengaged and passive public. In the areas of welfare, health, crime, employment, education and the environment, it is clear that achieving significant progress requires the active involvement and cooperation of citizens. Nudge theory(or nudge) is a concept in behavioural science, political theory and economics which proposes positive reinforcement and indirect suggestions to try to achieve non-forced compliance to influence the motives, incentives and decision making of groups and individuals. The claim is that nudges are at least as effective, if not more effective, than direct instruction, legislation, or enforcement. The concept is a relatively subtle policy shift that encourages people to make decisions that are in their broad self-interest. It’s not about penalising people financially if they don’t act in certain way. It’s about making it easier for them to make a certain decision. A good recent example can be found in UK pension policy. In order to increase worryingly low pension saving rates among private sector workers the Government mandated employers to establish an 'automatic enrolment' scheme in 2012.This meant that workers would be automatically placed into a firm’s scheme, and contributions would be deducted from their pay packet, unless they formally requested to be exempted. The theory was that many people actually wanted to put more money aside for retirement but they were put off from doing so by the need to make what they feared would be complicated decisions. The idea was that auto enrolment would make saving the default for employees, and thus make it easier for them to do what they really wanted to do and push up savings rates. In many areas of public policy the range of traditional tools to influence behaviour works well. For some social policy problems, however, influencing human behaviour is very difficult and complex, and the effectiveness of traditional approaches may be limited without some additional tools and understanding of how to engage citizens in cooperative behavioural change.
Which of the following was the main advantage of the UK pension policy of 2012?
It made people realize that decisions taken in haste do not yield to good results.
It helped the government to invest more on infrastructure and planning activities of an organization.
It encouraged people to save more money for their future without any fear or hesitation.
It helped the people to have a huge amount of money with higher interest rates.
It made people take complicated decisions and made the passive people think.
It encouraged people to save more money for their future without any fear or hesitation. D. It helped the people to have a huge amount of money with higher interest rates.
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