India is often referred to as the diabetes capital of the world, with around 41 million people living with diabetes in 2007, and projected to reach 68 million by 2025. In one of our engagements we were trying to understand how people living with diabetes manage this disease. One of the perplexing observations was that many people had the belief that their diabetes is under control. This conflicts with most data and expert opinion which suggests that majority of diabetes cases

Building toilets for over 50% of India’s population that defecate in the open is the primary goal of the Nirmal Bharat Abhyan (the erstwhile Total Sanitation Campaign or TSC), the flagship scheme of Ministry of Drinking Water and Sanitation. The numbers under TSC indicate that 91,820,973 household toilets have been constructed which covers about 73.03% of households. The government has spent large sums of money to achieve this coverage. The current scheme allows for a subsidy

Lets see if Prospect Theory can provide us with some explanation. People’s perception of gain are defined relative to a neutral reference point corresponding to the current asset position. For example, a gain of Rs. 10 is perceived more valuable when we have Rs 100 in our pocket as compared to the same gain when we have Rs. 1000. The same principle can be applied when we come to sports. In a very interesting paper, the authors explain why a golfer’s performance varies while h

In the recent past academic literature is abound with discussions around how classical economics is poor at explaining or predicting human behavior. For example, what explains Warren Buffett – spend a lifetime earning, only to give away his immense wealth to philanthropic causes one fine morning? And what happened to that elusive utility maximizing, self interested being whom we use to build our economic models? If Warren Buffett is an exception, let us look at ourselves and

There is now a huge debate between development and its consequences. Development, which leads to change in the environment and displacement of those living in that environment.  It is believed that a fair compensation and rehabilitation – providing alternate livelihood – could amicably solve this conflict. What is a fair compensation system for those displaced by developmental projects? The existing compensation structure is calculated on  principles of classical economics. A

If you have a parole hearing, when should you schedule your slot so that you get a favourable decision? The graph below might shed some light on that question. In this graph, Shai Denziger captures the results of 1112 parole hearings in Israeli prisons over a ten-month period. The vertical axis is the proportion of cases where the judges granted parole. The horizontal axis shows the order in which the cases were heard during the day. And the dotted lines, they represent the p

A recent article in ICNR raises fundamental questions on whether Chemotherapy has been oversold. Research done by 3 oncologists in Australia and the US published in the Australian Journal Clinical Oncology titled “The Contribution of Cytotoxic Chemotherapy to 5-year Survival in Adult Malignancies” found that chemotherapy contributes just over 2 percent to improved survival in cancer patients. Why then are well meaning doctors making the mistake of prescribing their patients w

As a bank, how do you instill integrity into your employees, which is crucial for your overall success and day-to-day functioning? Syndicate Bank, intuitively does a great job at that by using subtle nudges and showcasing other employees who have proved their honesty. Social proof, demonstrating desirable behaviour, will enable employees to better resonate with bank values, getting them to mirror these very behaviours. Hallway posters don’t stand a chance to influence action

Wikileaks recently obtained and released a classified US military video that shows the indiscriminate killing of over a dozen people in the Iraqi suburb of New Baghdad in 2007. The video, shot from an Apache helicopter gun-site, clearly shows the unprovoked slaying of a wounded Reuters employee and his rescuers. Two young children involved in the rescue were also seriously wounded. The New York Times analysis of why this happened is well elucidated. One of the starting points

Earlier this month, we wrote a column for Point-Of-Purchase, a Shopper Marketing Magazine. This article details what we learnt from our recent experiment to halt trespassing deaths while crossing the tracks, and how these can be translated into the retail space. ——————————————————- “Consumers claim 70% of their final purchase decisions are made at the store shelf, but we don’t know as much as we would like to about how these purchase decisions are really made. So we’re in th

When Suketu Mehta described Mumbai, he mentioned it as being all about transaction – dhandha. Sure, since Mumbai originated as a trading city, this culture of making quick money has become very unique to Mumbai. Because of how we naturally evolved as a people, that is why this city is fundamentally wired like this – the never-ending quest to make more wealth. This is the bigger context that has made Mumbaikars far more smarter than others in making money. No wonder, this city

Obama has spoken again. This time, its about new legislation to outline retirement initiatives. Meanwhile, what comes across as more alarming is the current state of savings in America. “The fact is, even before this recession hit, the savings rate was essentially zero, while borrowing had risen and credit card debt had increased,” “Half of America’s work force doesn’t have access to a retirement plan at work. And fewer than 10 percent of those without workplace retirement p

Biju wrote an article in Live Mint about how panic about swine flu actually ensured that the epidemic is kept in check. For those who would like to save an extra click, the article text is copied below: ———————————————————————– Posted: Wed, Aug 19 2009. 8:48 PM IST Livemint.com Right after the first casualty of swine flu this month, India witnessed headlines screaming about the epidemic. News channels kept covering its spread until it wasn’t breaking news any more. Schools,

We’re a herdlike species. As Cialdini, author of best seller, Influence puts it, “People want to do what they think others will do.” And this learning is being used across diverse situations, including getting people to reuse their towels at hotels, encouraging people to go out and vote, and getting teenagers to stay off drugs. All of us have sometime or the other been influenced by group behavior. What happens in this elevator is a brilliant example of how we would behave in

Many ads, fewer votes reads a piece in New York Times, All the awareness campaigns couldn’t get people to vote screams Mumbai Mirror. I am sure the Lead India team in TOI and elsewhere is feeling dejected. TOI spent millions in spreading awareness. This time seemed different, in deed it was, it went from bad to worse. Many experts have started giving various explanations, muslims didn’t vote, long weekend… so people went out of town, politicians didn’t offer a good choice, th

We wrote in The Wall Street Journal’s Mint about how it is not bad financial decisions that lead to an economic crisis, but actually biological origins of human behaviour, including deviant economic behaviour that leads to financial crises. You can read the article on LiveMint here. For those who would like to save a click, here is the entire article. ———————— Will another financial crisis, worse than the present one, hit the world economy? As governments around the world gr

So, Slumdog Millionaire swept the Oscars yesterday. Well done, Boyle and Co. In a tip of the hat, I not only compliment him on his deft film making skills, but also his acumen in influencing a very unique code that caused it to reign favourite at the Academy Awards last night. Let’s take a step back and see what might have been one big reason for the Slumdog sweep. As you might know, just recently, Pantone selected Mimosa as the colour of the year. The reasons couldn’t have b

Why should people who otherwise bargain for every penny, pay more for something knowing fully well they are overpaying? While classical economics likes to believe people are rational and hence selfish, interestingly most people don’t live by the laws of economics, or as Mullainathan & Thaler (Read the research paper here) puts it “economics is anti-behavioral”. They indulge in chocolates, spend time watching trashy movies, and fortunately enough, are concerned about people a

Dan Ariely, a professor of behavioral economics at Duke University and author of Predictably Irrational, presents examples of cognitive illusions that help illustrate why humans make predictably irrational decisions. This video is a talk he gave at the Entertainment Gathering in December 2008. It’s worth thinking about a few key points he makes in his talk. While we have a feeling that we are in control of all decisions we make, we find it tough to accept the fact that we are