Nudging on civic issues

Littering, regular payment of taxes, maintaining clean sewerage systems, eliminating wastage of water, reducing electricity consumption, maintaining surroundings clean, are all some of the major civic challenges facing policy makers. There are no regulatory solutions to such issues. Some of these problems are so severe that we cannot wait for an adequate level of social responsibility and civic sensibility to develop over a period of time.

Here is a model. Residents Welfare Associations (RWAs), which are fairly strong in many urban residential colonies, have inherent social deterrence and peer group pressure values. This can be leveraged to create an appropriate incentive system that encourages or nudges individuals to more socially responsible behaviour. These RWAs can by themselves or through third-party certitification agencies evalaute households on these parameters and then grade them. These grades can be in the form of marks or category classification.

Peer pressure is a very effective social nudge in middle and upper class residential colonies. The marks or grades received by each household can be displayed alongside the door or plot number plate. This will spotlight attention on the poor performers - large energy and water consumers,or those who do not maintain their surroundings clean, and the attendant social stigma is likely to nudge them towards behaving more responsibly.

In order to avoid conflicts of interest, these agencies can be paid by the Municipal Corporation directly. The cost of this service will be a small fraction of the total property tax receipts from the area. Certification process can be tendered out based on the fraction of property tax rates quoted.

Taking the experiment one step ahead, it may be possible to even impose some type of monetary penalty on the worst offenders. To make it easier to administer, this penalty may be collected along with the property tax (or even electricity or water charges), as a penal premium. The higher tax will have to be paid by the offending household till their scores are revised.