Lahore School of Economics

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Symposium on Behavioral Economics in Policy Making
September 04, 2019

Lahore School of Economics in collaboration with B4Development (formerly Qatar Behavioral Insights Unit, created by the Supreme Committee for Delivery and Legacy in 2016 hosted a symposium on Behavioral Economics in Policy Making on 3 September 2019 at Pearl Continental Hotel, Lahore.This symposium is the first ever initiative that will engage policy-makers and researchers alike to discuss the role that behavioral interventions can play in matters of compliance, public finance and accountability in Pakistan.

“Hosting the Middle East’s first mega event has inspired us to ensure that we serve as a catalyst for socio-economic progress and development. Integrating behavioral insight experiments within our vast array of programs is an integral part of that mission. We are pleased that the Government of Pakistan and other national stakeholders are considering applications of behavioral economics concepts and tools in various areas of public policy including public finance management, education and healthy lifestyle. We are glad to support as well as share lessons learned from our own experience in setting up such initiatives and conducting behavioral experiments.” said H.E. Hassan Al Thawadi, Secretary General of the Supreme Committee for Delivery and Legacy.

The symposium commenced with welcome remarks from Dr. Shahid Amjad Chaudhary, Rector of Lahore School of Economics emphasizing the growing role of behavioral economics in policy-making. Dr. Lori Foster, Professor, North Carolina State University, delivered the keynote address sharing insights from her experience as member of the White House Social and Behavioral Sciences Team. She commented on how policies assume individuals to act rationally and therefore do not result in the desired outcomes. A change in individual behavior would require policy-makers to nudge them in the right direction. The session was ended with an encouraging note from Dr. Fadi Makki, Head of B4Development, highlighted the importance of behavioral interventions for policy of learning from failed experiments even if they don't give academics high return.

The first panel discussion aimed to shed light on the importance of using behavioral insights to promote compliance, rule of law and revenue generation. The session was chaired by, Mujtaba Piracha, Additional Chief Secretary (Services Economy), Government of Punjab, and moderated by Umar Taj, Research Fellow in Behavioral Science, Warwick Business School. The discussion was commenced by James Vancel (CEO of the Busara Center for Behavioral Economics) who provided various examples from across the world on cheap behavioral interventions that worked to improve tax compliance. He stressed upon the idea of perception of self to bring about meaningful changes in a society. Dr. Ijaz Nabi, Country Director, International Growth Centre, on the other hand, highlighted the need to establish trust in government institutions by working toward greater transparency. Lastly, Azam Chaudhry, Professor and Dean, Lahore School of Economics, stressed on the need for policy-makers to effectively communicate well to the masses about the use of public funds. Moreover, tax givers face a great deal of uncertainty due to the rapidly changing regulatory local environment. The session concluded with remarks from Mujtaba Piracha, providing an interesting viewpoint from his experience with the government. He pointed out the rigidity in Pakistan’s organizational structure; to bring incremental changes one needs to take small steps.

The second session pointed towards the need to nudge policymakers for greater transparency and accountability. The session was chaired by Makhdum Hashim Jawan Bakht, Minister of Finance, Punjab, and moderated by Lori Foster. The panel commenced with insights from Adnan Khan (Professor, London School of Economics and Political Science). He reflected on areas that are most susceptible to behavioral biases and ended on the effectiveness of nudging policy-makers that lie that are central to enforcing any behavioral changes. Maroof Syed, Chief Executive Officer, Centre for Economic Research in Pakistan, highlighted the potential opportunities within Pakistan where behavioral interventions can bring about immediate impact. The last speaker in this session, Dr. Hamna Ahmad, Assistant Professor, Lahore School of Economics, shared experiences from her ongoing work aimed to improve governance and service delivery of Third Tier Organizations across country. Mr. Makhdum highlighted the need to move in the direction of using behavioral interventions and not solely depend on public finance. The session was concluded by Dr. Foster emphasizing the need to build trust by organizations using three core components namely ability, benevolence and integrity.

The last session set the stage for a round table discussion amongst academicians and government figures to strengthen capacity building using behavioral insights. In particular, the session aimed to explore the ongoing initiatives in this field to better inform government programs and policies. Participants in this session included Lori Foster (Professor of Industrial-Organizational Psychology, North Carolina State University), James Vancel (CEO of the Busara Center for Behavioral Economics) , Umar Taj (Research Fellow in Behavioral Science at Warwick Business School) , Azam Chaudhry (Dean and Professor, Lahore School of Economics) , Ali Hasanain (Head of the Department of Economics, Lahore University of Management Sciences) , Farah Said (Assistant Professor, Lahore School of Economics) , Aarij Wasti (Senior Legal Counsel at Supreme Committee for Delivery and Legacy, FIFA World Cup Qatar 2022) , Ali Shehzad (Additional Finance Secretary, Punjab) and Sarah Saeed (Faculty member, National School of Public Policy). The session was chaired by Shujat Ali, Dean, National Management College, National School of Public Policy and moderated by Sakib Sherani, Former Economic Advisor of the Ministry of Finance, Government of Pakistan and Fadi Makki, Head of B4Development and Founder of Nudge Lebanon.

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Labels: Behavioral Economics, Lahore School, Research, Symposium