The message of Nudge is to show us how we can be encouraged, with just a slight nudge or two, to make better decisions. The book starts by explaining the reasons for wrong decisions we make in everyday life.
Why do we so often make decisions that aren’t really the best choices for us? In many cases, we simply have too little or too much information, or we can’t foresee the consequences of our actions. It’s only when we have, and can process, the right amount of information that we are in a place to make rational decisions.
For example, when we have to choose an ice cream flavor at an ice cream shop, we usually make that decision rather quickly. We see which flavors there are and we know from experience that strawberry ice cream tastes better than mango, i.e., we have all the necessary information and can process it rapidly.
However, we feel differently in more serious situations, like when deciding whether to take out a loan. After all, there are all different kinds of loans: purchases on account, deferrals, consumer loans, securities, preliminary financing, interim financing, and many more. Some of them have a fixed interest rate, others a variable; all of them have different additional costs. And this information isn’t exactly laid out in plain writing. Usually, it’s hidden in the small print on the bright and colorful advertisement.
In other words, even when we are privy to all the relevant information, it can still be difficult to sort it all out and compare the services objectively. Situations like this can make us feel completely overwhelmed.
We often make bad decisions based on either too little or overly complex information.