Understanding Loss Aversion in PEB
Understanding Loss Aversion in PEB
Recycling, and switching to a bicycle — changes we should make to protect the environment.
And yet, it all seems so difficult. What's holding us back? And how can we make significant
changes?
A few acknowledged environmental issues: Plastic has become one of the environment's
biggest adversaries. In little more than half a century, we have produced 9 billion tons of it
globally. And though we have a growing awareness of how it is choking our streets and
rivers, smothering and strangling marine life, and even ending up in our food, it is more
universal than ever.
Then there's carbon dioxide. It's polluting our air, warming the planet, causing sea levels to
rise, and extreme weather like droughts, flooding, and destructive mega-storms. Yet for all
that, we continue to drive gas vehicles, manufacture using fossil fuels.
If breaking with old habits could stop all the environmental issues discussed, the big question
is why don't we? Conservationists and climate change activists are working with behavioral
scientists to try and come up with an answer. There are numerous factors that hinder
individuals when they try to adjust their behaviours toward living more sustainable lifestyles.
In environmental terms, that means the positive impacts of changing the way we live, in order
to benefit the planet, are not as motivating as the perceived sense of loss that would go hand-
in-hand with certain eco-friendly actions, such as no longer using cars.
Research shows that we hate losing something around twice as much as we look forward to
getting it in the first place. People hold back because there is no visible immediate effect
from their positive action, and that the greater benefit will be felt by subsequent generations.
Loss aversion is caused by a mixture of our neurological makeup, socioeconomic factors, and
cultural background.
Our brains
The amygdala is the part of our brain which processes fear. For example, the amygdala
creates an automated, pre-conscious sense of anxiety when we see a snake. The reaction we
experience with loss in this part of our brain is similar to our brain’s response to when we
react to airplane turbulence or a spider, meaning fear and loss are closely related.
Socio-economic factors
Socio-economic factors also play an essential role in one’s disposition to loss aversion, with
social hierarchy proving to be a good indicator of an individual’s level of loss aversion.
Research has found that people in power are less loss averse. This is because powerful
individuals are typically in a better position to accept a loss if it should incur, due to their
wealth and network. As a result, these individuals give less weight to losses than the average
person.
It has also been proven that powerful and wealthy individuals give more value to gains than
non-powerful people. Wealth, similar to power, also plays a role in an individual’s loss
aversion. Like powerful people, wealthy people typically have an easier time accepting losses
they incur. Thus, an individual’s socioeconomic status and environment prove to be very
influential in regards to their level of loss aversion. Individuals with a higher mean income,
situated in wealthier villages, were found to be less loss-averse. Additionally, wealthy
individuals or powerful individuals were more willing to take on risk. These socioeconomic
combinations of traits all influence an individual’s loss aversion, and willingness to take on
risk when decision-making.
Thus, the Human aversion to loss theory suggests somebody with a high socio-economic
status might not be very bothered by extreme environmental concerns as they have the
resources to cope with it. But at the same, if someone has a good standing in society, they can
also be more responsible citizens and make use of their power to bring about awareness about
env problems.
Culture
Cultural background has been linked to how loss-averse an individual may be. A study
conducted by Dr. Mei Wang surveyed groups from 53 different countries to understand how
different cultural values affect an individual’s perception of losses compared to gains. The
group discovered that people from Eastern European countries tended to be the most loss
averse, with individuals from African countries being the least loss averse.
One explanation for this variation among cultures and loss aversion can be linked to
collectivist vs. individualist cultures. Those from collectivist cultures were more likely to
have more and closer social connections, meaning that if they made a poor decision and
incurred loss, these individuals would have support from their friends, family, and
community. This support system helped individuals take risks without feeling losses as
intensely. Inversely, those from individualistic cultures didn’t have the same social safety net
as their collectivist counterparts.
Human emotions
In the past, conservation and environmental organizations have focused on rational arguments
to try and convince people to make positive changes. But since success with this strategy has
been limited, some groups are now trying a different approach. We are a highly emotional
species, so emotions are often more powerful than reason in terms of their influence on our
decision-making.
There are two different types of emotions, the basic emotions (i.e., joy, sadness; surprise;
disgust; anger; fear) and self-conscious emotions (i.e., pride, shame; embarrassment;
gratitude; hubris; guilt). Unlike basic emotions that are biologically generated from one’s
internal state, people experience self-conscious emotions only when they are able to evaluate
their behaviour from an external perspective, or knowing their behaviour is being evaluated
by others. Because people intend to behave in socially appropriate ways in order to be highly
valued by others, it is therefore proposed that self-conscious emotions play a more important
role in motivating one’s pro-environmental behaviour compared with basic emotions.
When it comes to motivating complex human behaviour like PEB, self-conscious emotions
are perhaps the most important. The relevance of self-conscious emotions in the context of
pro-environmental decision making is demonstrated by a range of studies. Self-conscious
emotions are shown to have a self-regulatory function, they provide immediate and important
feedback on one’s social as well as moral acceptability, and guide behaviour according to
social standards. For example, pride can effectively drive people to behave in (pro-
environmental) ways in accordance with existing social morals that make them proud of
themselves. By contrast, shame and guilt help people move away from immoral or unethical
behaviour because people intend to avoid the negative subjective feeling of being ashamed or
guilty.
Government planning climate protection and showing a commitment to action can make a
huge difference. It gains media attention and really creates a sense that our leadership is
concerned about this, and talking about it as a priority we need to pay attention to.
But some environmentalists question whether that goes far enough. Some argue that it is also
our responsibility to drive governments to take further action that will lead to significant
impacts. It's not just your capacity to sort trash or ride a bicycle, but your capacity to actually
get bicycle lanes made, the recycling systems in place. It has to come as much from the
bottom up as from the top down, and you have to influence that. By becoming politically
active, people have more of an impact than they might think — not only on politicians but
also on their own communities and beyond.
The key to encouraging and speeding up behavioral shifts is getting people to be more
positive about our battle with climate change, to show people that it is not an unbeatable
problem.
1.2 Environmental education, environmental prompts and cues.
In general, it is acknowledged that human behaviour is influenced by internal and external
factors. Internal factors comprise people’s beliefs, values, attitudes, and emotions.
Environmental knowledge is also an important internal driver of pro-environmental
behaviours. External factors are related to the context in which individuals behave and make
choices, i.e. formal regulation, social norms, cultural taboos. Therefore, interventions aiming
to change human behaviour should consider both internal and external factors and provide
effective prompts for behavioural change.
Since the 1970s, social and environmental psychologists have examined different ways to
encourage people to adopt pro-environmental behaviours in order to reduce the effects of
human behaviour on the environment, such as the depletion of fossil fuels and climate
change. Current global trends however, indicate that our impact on the environment is still
considerable: carbon dioxide emissions through the combustion of fossil fuels have steadily
increased over the past decade.
Now we will focus on strategies for behaviour change, as they have been studied in the past
three decades. The question is: What has research taught us, and, perhaps more importantly,
how can we foster pro-environmental behaviour change?
Interventions need to be carefully planned before they are implemented. A few points are
noteworthy in this respect to increase the effectiveness of interventions.
Thirdly, it is essential that the effect of the intervention is assessed properly. Ideally,
intervention studies include measurements of the target behaviour before and after
implementation of the intervention, a so-called pre-test/post-test design, and include a control
group that has not been exposed to the intervention. This way, changes in the outcome
measure can be monitored and compared. Also, including measurements of factors related to
behavioural decisions (e.g. knowledge, attitudes) is important, as this will provide insight into
the reasons why an intervention was effective (or not).
Education and awareness
Communication and dissemination (the action or fact of spreading something, especially
information, widely) of information in mass media campaigns, and targeting participants of
interventions have been common policy approaches for a long time. Education and awareness
(EAA) methods consist of providing information materials such as handouts, newsletters,
advertising campaigns, posters and magazines. It is one of the most common methods, often
the default approach, to foster behavior change. The model relies on the knowledge-deficit
assumption, which suggests that in the absence of relevant information, behaviour change
will not occur. Changing attitudes or knowledge may trigger new behaviours.
However, they are usually ineffective. Research on information and education effects
environmental problems has generally found that information can increase knowledge but has
minimal effects on behavior. Specific and correct knowledge about environmental problems
may predict pro-environmental behavior to some extent, as well as tailored information,
which is designed to reach a specific person or group on the basis of characteristics unique to
those individuals. Eg the population of owners of companies and factories should be provided
educational awareness about how their organizations can pollute the environment, school and
college students could be provided educational awareness about how to not litter around their
schools and colleges. Street vendors could be briefed about how their littering can impact the
environment and how they can prevent it.
Scientific evidence suggests that EAA is particularly effective when individuals are
motivated by a pre-existing interest in environmental issues and willingness to engage in pro-
environmental behaviours, however, pro-environmental attitudes do not always foster pro-
environmental behaviour.
However, information and knowledge may also constitute a psychological barrier. Gifford
(2011) refers to “limited cognition” about the problem due to our ancient brain that is not
developed to deal with diffuse threats (threats that are spread over a wide area or between a
large number of people.) whose consequences lie far in the future. Because we are bad at
sacrificing short-term enjoyment for long-term benefits, we deny responsibility for what is
happening. Greenhouse gases are not visible to the naked eye, since they are colorless and
odorless, which makes it difficult to take the information about them seriously and know how
to act.
This lack of knowledge about the cause and extent of climate change becomes a source of
uncertainty (because of lack of education about the problems, people do not know what to
rely on, believe and they may not be sure about how much are their behaviours impacting the
env. , something which, as experimental research resource dilemmas have demonstrated, may
lead to a reduction of pro environmental behavior.
Even if knowledge and education alone often do not lead to more pro environmental
behavior, these factors can serve as priming agents. Priming occurs whenever exposure to
one thing can later alter behavior or thoughts.
Prompts and Cues
The technique of prompting has been used to encourage pro-environmental behaviour since
the early years of intervention research. It entails a short-written message or sign which
draws attention to a specific behaviour in a given situation. Prompts are simple reminders to
behave in an appropriate way, e.g., to avoid littering or to switch off the lights when leaving a
room. By using prompts, one assumes that the target group already has a positive attitude or
has the intention to carry out the behaviour in question, but lacks a cue in the situation where
the behaviour is required. Thus, prompts can be assumed to overrule the automatic elicitation
of problematic behaviour. Depending on the content of a prompt, they can be assumed to
directly convey sanctions or incentives (e.g., ‘Thank you for not littering ‘), which can be
linked to behaviorist approaches.
Austin, Hatfield, Grindle, and Bailey (1993) used prompts (pictograms) to encourage
recycling and proper disposal of trash. They investigated the effects of prompts on the
recycling behavior and correct disposal of trash. One sign prompted recycling (posted above
the recycling receptacle), and the other sign prompted proper disposal of trash (posted above
the trash receptacle). Results indicated that the sign prompt increased the desired behavior,
wherein installation of the sign prompts in close proximity to receptacles resulted in a 54%
improvement, whereas posting of sign prompts over containers 4 m apart resulted in a 17%
improvement. Suggesting that prompts can be especially effective if placed directly where the
requested behaviour is going to be carried out.
Prompting techniques have been criticized for having only weak, short-term effects (Bell et
al., 2001). Prompting is mainly effective with less complex and easy behaviours, if
formulated politely and if well placed and timed (see Geller, Winett, & Everett, 1982).
1.3 Reinforcement strategies
Consider your current behaviour. What motivated you to attend this lecture? Probably your
behaviour was motivated to some extent by one or more consequences. For some of you, a
consequence might be gathering information to use in writing a paper or performing well in
an exam. Others may be reading for nobler consequences: to gain knowledge for solving an
environmental problem or simply to learn more about environmental psychology.
People often persist in old patterns of behavior despite awareness of the negative
consequences for the environment and the presence of viable alternatives (e.g. organically
grown products, public transport). So why do people maintain their environmentally harmful
behaviour? How can we decrease the occurrence of such undesirable behaviour and increase
the frequency of pro-environmental behaviour? According to applied behaviour analysis, in
order to change behaviour, one has to analyse and alter the consequences of behaviour.
As you may realise by now, almost all behaviour is determined by its consequences.
As proposed by B. F. Skinner (1974), people are motivated to do things for the promise of
what follows. In other words, we do what we do to obtain positive consequences or to
escape or avoid negative consequences. Moreover, we repeat behaviours that lead to positive
consequences and avoid behaviours that result in negative consequences. This elegantly
simple idea is the theoretical basis for interventions that aim to improve environmental
behaviour by offering rewards and penalties.
What this model states is that rather than occurring in isolation, behavior is preceded by an
antecedent (trigger) that sets off the behavior and is followed by a consequence, or a reaction
to the behavior. This process is easily remembered by the acronym ABC.
Antecedents are events or environments that trigger behavior and are followed by
consequences. The three-term contingency suggests a behaviour-based approach for
encouraging pro-environmental behaviour. The strategy is to introduce the availability of
pleasant consequences for pro-environmental behaviours or unpleasant consequences
for environmentally harmful behaviours.
Programmes that offer rewards for beverage containers provide a real-world example
of the three-term contingency.
The antecedent is the message on the container announcing the availability of a reward.
When individuals perform the desired behaviour (i.e. turn in the bottles or cans at a
designated location instead of throwing them in the trash), they receive the
consequence of a small reward.
In 1971, Oregon was the first US state to enact a ‘bottle bill’. This bill mandated a five-cent
rebate for the return of cans, bottles and other beverage containers. After the bill was
implemented, 90 percent of containers were returned, resulting in a significant reduction of
levels of litter (Oregon Department of Environmental Quality, 2004), improved
recycling rates, and improved resource conservation. It is now considered one of the
success stories in environmental management.
However, results of several studies suggest that the effect of rewards is rather short-lived, as
the desired behaviors usually dropped back to baseline levels when the reward was removed
(Abrahamse et al., 2005). While incentives are acknowledged to be effective for an initial
behaviour change, their sustained effect over time is still debated. For example, Deci et
al. argue that motivation to sustain the pro-environmental behaviour is reduced after the
incentive is discontinued.
Outreach and relationship building (ORB) relates to all activities designed to provide services
and goods to improve pro-environmental attitudes and behaviours. Such activities can take
the form of direct and indirect information but it distinguishes them from EEA interventions
because the focus under ORB is building relationships within communities. Examples of
ORB interventions include workshops, training, and community engagement activities (e.g.
focus groups and public events). Miller and Buys (2008) found that residents who kept a
close connection with others in the community tended to wash their cars in a more
environmentally friendly way. Residents who scored higher on the Neighborhood
Connections element of social capital were more likely to wash their car in an
environmentally friendly manner.
Videras et al. (2012) found that social relationship matters for working with others in the
community to solve a local environmental problem, volunteering in environmental protection
projects, and recycling. Macias and Williams (2014) found that time spent with neighbors can
significantly increase residents’ pro-environmental lifestyles.
Typically, successful ORB projects require several training sessions, focus groups, and a
large number of meetings with moderators, where participation is high and people exchange
opinions and build trustworthy relationships. Given the amount of time, money and
organizational activities requested for ORB projects, they are less numerous, and published
assessments of such projects are even fewer.
Commitment
A commitment is an oral or written pledge or promise to change behavior. Once people have
made a commitment as an antecedent strategy, they are more likely to perform the target
behavior due to the activation of personal and social norms, especially when the commitment
is active, public, and perceived as voluntary. Social norms are rules and standards for human
behavior that are shared by members of a group. These norms are what is commonly done or
(dis)approved of and they refer to what other people think or do. In that sense, social norms
can be potential driving forces for the progress of behavior change, but they can also
contribute to regress (Thøgersen, 2008). The tendency to compare one’s actions with those of
others is true for most people (Festinger, 1954). From these observations of others, people
derive which subjective and descriptive norms can be considered the “correct” behavior.
Modeling
Modeling strategies demonstrate the desired behavior to intervention participants who are
influenced through observational learning, an insight based on Bandura (1977). The
demonstrated examples used as antecedent stimuli are assumed to be followed when they are
perceived as understandable, relevant, meaningful, and rewarding (Abrahamse et al., 2005;
Sussman, Greeno, Gifford, & Scanell, 2013). Modeling can involve in vivo demonstrations,
videotapes, or demonstrations via television.
4.4 Environmental movements
Concept of Social Movement: The term ``social movement “first came into use, early in the
nineteenth century. The term “social movement'' is being used to denote a wide variety of
collective attempts to bring about a change in certain social institutions or to create an
entirely new order.
Group consciousness, that is, a sense of belonging and of solidarity (unity or agreement of
feeling or action, especially among individuals with a common interest; mutual support
within a group.) among the members of a group, is essential for a social movement, although
empirically it occurs in various degrees. This consciousness is generated through active
participation and may assume various socio-psychological characteristics.
1. the awareness exhibited by individual group members about the group, its members, and
their commonalities. Just as self-consciousness pertains to awareness of the self, so group
consciousness pertains to awareness of the collective.
“It was only in the 1970s a coherent and relatively organized awareness of the ecological
impact of the state development process started to develop, to grow into a fully fledged
understanding of the limited nature of natural resources and to prevent the depletion of
natural resources”
The genesis of concern for environmental protection in India, “can be traced back to the early
twentieth century when people protested against the commercialization (the process of
managing or running something principally for financial gain) of forest resources during the
British colonial period.
At the international level, the growing salience of the environmental crisis was brought
out by four important events.
1. The first event was the United Nations Conference on ‘Human Environment’ held in
Stockholm, Sweden (1972).
2. The second event was publication of the report “Limits to Growth” (1972).
3. The third, release of the report of the Brundtland Commission entitled ‘Our Common
Future’ (1987).
4. Fourth, event was the ‘Earth Summit’ in 1992.
Guha Ramchandra (1997: 345-346) lists the three events which occurred within the
country in 1973, that facilitated debate on environmental issues in India:
A large number of environmental movements have emerged in India especially after 1970s
and 1980s. In this context Sahu, Geetanjoy (2007) noted that: In India, the environmental
movement has grown rapidly over the last three to four decades.
The love for nature has been handed down the ages, becoming an integral part of the Indian
psyche. Nowhere is this better exemplified than in the martyrdom of the Bishnois in Khejarli
village in Rajasthan. In 1730 AD the then ruler of a native state had ordered the khejri (Prosopis
cineraria) trees to be cut in order for the construction of a fort. This sparked off a strong
collective protest from the local Bishnoi community. 363 men and women, young and old, one
after the other, placed their heads against the trees to prevent them being cut and were axed
along with the trees. The ruler of the state was so moved by this sacrifice that he sought pardon
from the people and issued an order that no green trees should in future be cut in the Bishnoi
village. This happened over two centuries ago when the world had scarcely become conscious
of ecological consequences of the reckless felling of trees.
The Khejarli sacrifice was characterised by total non-violence, or ahimsa, on the part of the
Bishnois who stood up to perform what they considered their bounden duty. For them, every
plant or animal is a living being just as humans, and hence deserves to be protected. This
served them well as it fosters a better relationship between human beings, their environment,
their religious beliefs and each other, allowing all to live harmoniously. Today experts call
this ‘sustainability’, and have labelled Bishnois as ‘India’s first environmentalists. Yet, within
their community it is simply understood to be their dharma.
2. Chipko Movement
Notes:
Year: 1973
Place: Chamoli district and later at Tehri-Garhwal district of Uttarakhand
Leader: Chandi Prasad Bhatt, Sunderlal Bhauguna, Gaura Devi, Govind Singh Ranawat,
Shamsher Singh Bisht and Ghanasyam Raturi
Aim: the amin objective was to protect the trees on the Himalayas from the axes of the
contractors of the forests.
What it was all about: The name of the movement, that is ‘Chipko’, comes from the word
‘embrace’, in Hindi. It is said that the villagers hugged or embraced or stuck to the trees in
the forest to prevent them from being felled by the contractors. The strategy of ‘embracing’
the trees to resist the felling of the trees was thought of by Chandi Prasad Bhatt in a meeting
in the Mandal on April 1, 1973. The name ‘Chipko’ was derived from the consensual strategy
of clinging on to the trees as a non-violent direct action.
• Save Aarey
At a time when the rest of the world was moving towards climate action, the Bombay High
Court dismissed several petitions against the felling of the Aarey Colony for the Mumbai
Metro Rail Corporation Limited’s (MMRLC) metro 3 car-shed. The ‘Save Aarey’ protest
rallies had been going on since the proposal of the car shed and gained momentum after the
approval in August. Aarey is the only national park located within the city limits of a
metropolis; it is home not only to flora and fauna, but also to many tribal communities who
have been displaced because of various government projects.
Several concerned citizens, environmentalists, students and activists took to the streets on
September 1, 2019, with posters to form a human chain and express their dissent against the
move. It was amid this that HC cleared the path to felling trees. Following its
dismissal, Brihanmumbai Municipal Corporation (BMC) authorities, in an inexplicable haste,
felled approximately 2000 trees on the night of 4 October.
Protesters started pouring into Aarey to save the ‘green lungs of Mumbai.’ They were lathi-
charged by the police and many were detained for several hours in various police stations
across Mumbai over the weekend. Section 144 was imposed till October 6. When the newly
elected CM Uddhav Thackeray ordered to stop the construction work of the shed, things
looked promising. However, the issue is still ongoing with little hope of the forest being
restored to its former glory.
• Save the Sundarbans
The Sundarbans are the largest mangrove forest in the world, and are located in the delta of
the Ganga and the Brahmaputra. The area is home to Bengal tigers and saltwater crocodiles
among other species. 60% of it lies in Bangladesh and the rest in India. It spans over 10,000
square kilometers and is home to several species of flora and fauna including the Royal
Bengal Tiger. However, the largest intact tract of mangrove forest in the world is shrinking
fast because of increased sea levels and beatings from cyclones, which are more frequent due
to climate change.
The recent cyclone Amphan in May 2020, the worst cyclone since 1737, left a trail of misery
in the Sundarbans. Livelihoods were destroyed, people were displaced, embankments were
breached and thousands of people are now solely reliant on relief camps. The mangrove
forests are at a high risk because of a more pronounced rise in sea level than anywhere else
which could eventually lead to a severe migration crisis of the local communities. A
campaign emerged online to #SavetheSundarbans. In the middle of a global pandemic,
concerned citizens resorted to donating to organisations working on ground, initiating
dialogue about this treasure like the Amazon or Australian Bush and making art to spread
awareness under
The third week of September, 2019 saw students across big cities like Delhi, Mumbai,
Bengaluru, Kolkata and Chennai stage peaceful protests at prominent city centers, heeding to
Greta Thunberg’s call for mass protests to urge governments to take definitive action on the
issue of Climate Change. This was largely youth-led who made it a point to stress the
urgency of global warming through creative slogans. The point was to spread awareness
about the impact a mere 2-degrees shift could have on the planet.
Environmentalists like Bittu KR also participated and he emphasised how the government has
to heed to concrete policy demands and go beyond token afforestation in an attempt to
portray its commitment to the environment. It was part of a global expression of solidarity to
fight for climate justice and emphasise on its importance.
The nation’s capital throttled into an environmental crisis as the Air Quality Index (AQI)
plummeted to 494. Toxic smog choked the city with mere breathing in Delhi being
considered a hazard to one’s health. The protest, organised as a result of various movements
on social media, saw over 1,500 people gather at Amar Jawan Jyoti, India Gate on November
5. Leonardo Dicaprio highlighted the success of these demonstrations in triggering climate
action by the government. A special panel was set up to address the issue, Supreme Court
ordered the state governments to address the crop and waste burning issue, Centre agreed to
use the Green fund to combat toxic air pollution but the air quality was still abysmal.
Delhi experienced ‘clean’ air following the lockdown but the air quality started dipping
slowly. New Delhi has been the world’s most polluted city for the past 2 years despite
government efforts like the Odd-Even Scheme. It just goes to show just how large the threat
of global warming is looming. The government needs to be making stronger policy changes
to combat air pollution and ensure safety for its citizens.