The need to redesign our policies so that adherence is acknowledged and rewarded substantially and frequently.
During one of the classes of the GCPP program, I remember @acorn teaching us the various levels of government interventions which were classified into ‘do nothing’, ‘nudge’, ‘marginally change incentives’, ‘drastically change incentives’ and finally ‘do it yourself’ in the increasing order of capacity of government and the extent of intervention.
In this policy framework, the ‘carrot and stick’ approach can be put into the category of ‘marginally changing incentives’. This approach can decently alter incentives for people and organisations to adhere to the policy guidelines without demanding very high capacity. The classical ‘carrot and stick’ approach means that non-adherence to a set of rules is discouraged by punishment whereas adherence to the same set of rules is awarded in order to encourage good behavior.
The advantage about this approach is that it makes people act in their self-benefit. There are no moral angles like the oft-repeated and overrated ‘duty towards a nation’ or ‘responsibility to a society’. In India, only policies that people think will visually lead to their gratification in some way or the other, and that too in quick time can work.
In the policies of the day, the carrot and stick paradigm exists to some extent but has largely been unsuccessful. This approach has faltered on both counts:
1. Since the conviction rate in India is extremely low, the ‘stick’ approach hardly works. The sociological function of a punishment is that it discourages other potential criminals from doing it as it makes them ponder over the high costs. However, the slow judicial process and a weak conviction rate means that people hardly fear the consequences.
2. Either the carrot does not exist and even if it does, it is tasteless to say the least.
Thus, there is a greater need to reward good behavior and do it in more obvious ways so that people feel that self benefit is maximized and they can flaunt their ‘being good’ status. This will lead to individual gratification and larger good at the same time.
It is time that we move beyond ideological and moral concepts like responsibilities towards the motherland, moral duty towards the society which are weaker incentives to influence human behavior.
Instead we need to bring a more rational approach to it. We need to think how we can make a person who regularly follows traffic rules feel proud of himself/herself. We need to make a person who gives up his/her job in the US to start something in India feel welcomed. We need to reward apartment complexes that use solar water heater and composting. We need to reward shops that generate less garbage. Can we reward a person who pays his/her taxes regularly and before time for say, five years continuously? Can we reward an auto union that does not go on strike for a few years?
Some public policies are using this concept already. For example, the IT department’s policy of awarding a standard deduction of 1 lakh from the taxable salary based on specific savings. Now, I don’t know anyone who does not take advantage of this rebate because there is a direct and evident self benefit. Thus, the government is able to encourage domestic savings – a policy goal while people feel that they are saving on the taxes.
Another instance of such a policy is the recently started Sugama Savaari campaign by the Bangalore Traffic Police wherein if the commuters rate the drivers well through a mobile app, the auto can proudly carry a sugama auto sticker.
In Pune, apartment complexes having a solar heater and functioning compost plant get a 10% rebate in the property tax paid which has in turn encouraged people to opt for these environment friendly technologies.
Since the government has now enabled the aadhaar program aggressively with a provision to link it to bank accounts, people can be transferred benefits for good behavior directly to their accounts in case it is deemed that a monetary carrot would help.
In a country like ours the stick approach alone or a stick approach balanced by a moral angle will never work. Hence, alongwith the stick we need to bring in the carrot and make it tasteful as well!