JACOB GOLDSTEIN, HOST:
There are all these big problems in the world, right? There's climate change. There's poverty. And we've done shows about those things. We're going to do more shows about those things - but not today. Today's show is about problems that aren't big. It's about problems that are really, really small.
DAVID KESTENBAUM, HOST:
GOLDSTEIN: And fixable. The show is about tweaks, little changes you could make to make the world better.
KESTENBAUM: Can I tell you one thing that drives me crazy? Look at the keyboard in front of you.
KESTENBAUM: See the keypad on the right, the little box...
GOLDSTEIN: The number pad.
KESTENBAUM: With the numbers?
GOLDSTEIN: The numbers, yeah.
KESTENBAUM: One is at the bottom.
KESTENBAUM: The nine is at the top.
KESTENBAUM: Now look at the telephone keypad.
GOLDSTEIN: Oh (laughter) it's the opposite.
KESTENBAUM: Where is the one?
GOLDSTEIN: It's at the top on the phone and at the bottom on the number pad.
KESTENBAUM: Come on, people, get it together. Somebody fix it. I'm constantly typing the wrong numbers and, like, calling the wrong people.
GOLDSTEIN: OK, the tweaks we have in the show today are actually much better - all due respect - than that one. We called up really smart people. And they had actually, like, really interesting, really little ideas. One of them is how to get people to lie less. Another one is a way to take the edge off in your personal life when things are going badly.
KESTENBAUM: We got one tweak from a guy who used to work in the White House. And there's one about supermarkets. It's a good one.
GOLDSTEIN: Hello and welcome to PLANET MONEY. I'm Jacob Goldstein.
KESTENBAUM: I'm David Kestenbaum. Today on the show, tweaks, little ways to make the world better.
GOLDSTEIN: We're going small.
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GOLDSTEIN: OK, tweak number one, sign at the top.
KESTENBAUM: We sign forms all the time. When you file your taxes, you sign saying, everything I told you there is true. When you apply to college, you sign a form saying, I wrote that essay myself.
GOLDSTEIN: Insurance, you know, I never smoke. I don't drink. I'm super healthy.
KESTENBAUM: When you buy a house...
GOLDSTEIN: When you buy a house, forget about it. When you buy a house, you're signing forms for, like, a week. And, you know, the way the forms work, you put in all this information, all these numbers or whatever. And then at the end, at the very bottom of the form, that is where you sign to basically say, yes, everything I wrote on this form is true. Francesca Gino, a professor at Harvard Business School, says we're doing it all wrong.
FRANCESCA GINO: We should sign at the top of the form.
GOLDSTEIN: That's it. Instead of signing at the bottom, we should sign at the top.
GINO: Exactly, it's that simple.
GOLDSTEIN: If people sign at the top instead of the bottom, Gino says they are much less likely to lie.
KESTENBAUM: Really? Sign at the top instead of the bottom, people don't lie?
GOLDSTEIN: Yeah, there's some evidence here. Gino and her colleagues have done some experiments. In one of them, they had students come in and do these math puzzles. And the students got paid a dollar for every puzzle they completed in a set amount of time. And they didn't know anybody was going to be checking their work. And then they went and they filled out these forms to say how many puzzles they had finished. Some of the forms had the signature at the top. Some had it at the bottom. And where the signature was on the page made a big difference.
GINO: In the case in which the signature was at the top, 37 percent of them lied. But when the signature was actually at the bottom, the percentage went up to 79 percent.
GOLDSTEIN: Seventy-nine - so...
GINO: So it's quite a big difference.
GOLDSTEIN: Almost everybody lied when the signature was at the bottom.
KESTENBAUM: I could see that. How many puzzles did you get right? Oh, 11,12,13 - maybe 13, yeah.
GOLDSTEIN: You're definitely going to round up, right?
KESTENBAUM: There's no rounding. You either got it or you didn't.
GOLDSTEIN: So, OK. So this is a dramatic finding. But, you know, it was a small study. They did it in a lab. It's really not clear what it tells you about this idea out in the real world. So Gino and her colleagues did this other study, a much bigger study, with 13,000 people who were filling out their forms for car insurance. This was - this was not a lab study. And they found that people who signed at the top were, in fact, less likely to lie. In this case, they were less likely to lie about how many miles they drive.
KESTENBAUM: 'Cause if you put in, I don't drive that many miles, you get a lower insurance premium.
GOLDSTEIN: That's the idea, yeah. I mean, Gino says this works, this moving the signature thing. It works because most people - not everybody - but most people actually want to tell the truth. And the problem is when we're filling out a form, we don't really think about the fact that in general, we want to be honest people. You know, what we think about is, oh, I want to pay less for my car insurance, or I want to get that extra dollar for doing a math puzzle. Or I want to get into this college. So we, like, you know, we fudge the numbers. And then, after filling out the form, you get to the bottom. And then you see that signature box where you promise that everything you just wrote down was true.
GINO: It's just too late. You're not going to go back and scratch the numbers that you just reported and correct them. You're done with it.
KESTENBAUM: It's like when you testify in court. Before you testify, they have you put your hand on the Bible and say, everything I'm about to say is true. It's not like you testify and afterwards they say, is everything you just said really true? Francesca Gino says having people sign at the top of the form is like that. It's a reminder, right when you need it, to tell the truth.
GINO: We want to be honest. And we're making a promise that we will. And so it allows us to stick to that promise.
KESTENBAUM: It's an easy fix.
GOLDSTEIN: Yeah, just cut and paste. Put the signature at the top, done.
KESTENBAUM: All right, tweak number two. This is a quick one.
KATE BAICKER: My name is Kate Baicker. I'm a professor of health economics at the Harvard Chan School of Public Health.
GOLDSTEIN: And what is your tweak? What's your one small way to improve the world?
BAICKER: Two words for you, one line.
KESTENBAUM: As in one line at the supermarket checkout, one line at IKEA - please, IKEA, one line. When you're ready to check out, she says you should go to the back of the one line. And then, when you get to the front of the line, you go to the next open register. It's how they do it at the bank. It's how you check your bags at the airport.
GOLDSTEIN: It is not how you buy your groceries at the grocery store, right? You go to the grocery store, and there is a different line for every cash register. It makes Kate Baicker crazy because she has to pick which line.
BAICKER: You see one line's kind of moving. One line has a lady with a giant basket. One line has a guy who can't find his wallet. One cashier seems totally together. One seems completely distracted. And you're trying to calculate which line is going to move the quickest. And inevitably, you choose the wrong one. And then you watch the other lines move and move and move. And you think, should I switch? Should I switch? I'm staying here. Should I switch? Should I switch? And it never works out well. You never get elation from choosing the right line. When you choose the right line and you go through, you're not even thinking about it. But when you choose the wrong line, you just stew in it while you wait.
KESTENBAUM: Kate says this is a problem that science has solved. We know the answer - one line.
BAICKER: There's a whole branch of operations research that goes back, like, 100 years about how to get throughput most efficiently through a system. If we all wait in one line, the average wait time is the same as if we all waited in different lines. It's not like you get any more people checked out than you would otherwise. But the variance goes away. You sort of average it out.
GOLDSTEIN: But nobody wins anymore. In your system, nobody wins.
BAICKER: Nobody wins; nobody loses. We're all in line together. Isn't that a beautiful vision?
GOLDSTEIN: One line, it's the operations research hippie dream.
KESTENBAUM: All right, tweak number three, have the government do your taxes. This one comes from Austan Goolsbee. He's at the University of Chicago, and he was an adviser to President Obama, worked in the White House.
GOLDSTEIN: There's something that's bothered him for a long time.
AUSTAN GOOLSBEE: You've got millions and millions of people in the United States who, in my view, are having to fill out their tax returns for no reason. They have a single job. They have a single bank account. And all of the information that they're writing in and filling out and looking up to put on their tax return, the IRS already got it direct from their employers, direct from their banks.
GOLDSTEIN: The W-2, the 1099, all the basic tax forms, one copy goes to you. The other copy goes to the government.
KESTENBAUM: They already have it.
GOLDSTEIN: Goolsbee says this is a waste. It's a waste of time. And for people who pay accountants or pay for software, it's a waste of money. For people with simple finances, he says, the IRS could just fill out the tax forms automatically.
GOOLSBEE: They would send you a form that says, here's what we already know from your W-2s, and here's what we already know from your 1099s. Here's what we think your taxes are. And if it's correct, you sign it. You're done.
KESTENBAUM: He says if this feels big brother-y to you or you just don't like it, no problem. It would be optional.
GOOLSBEE: If you don't trust the government, you wouldn't have to - if you want to do your own taxes every April 15, by all means, go ahead and do it.
GOLDSTEIN: Goolsbee didn't come up with this idea. It's been out there basically forever. People talk about it every year. And yet, of course, we're all still doing our own taxes.
KESTENBAUM: He says there are basically three groups who are opposed to this happening.
GOLDSTEIN: Three totally unsurprising groups.
KESTENBAUM: I bet you could think of at least two of them. Here, I'll give you a couple seconds. Ready? Got your list? Group one.
GOLDSTEIN: The IRS. The IRS is like, we'd have to change our systems. All the timing of when people would send stuff in is changed. We couldn't just flip a switch.
KESTENBAUM: Group two, accountants, the TurboTax people - right? - they have opposed this.
GOLDSTEIN: Sure, for obvious reasons, right? And then group three? Group three is basically a guy, Grover Norquist, a very powerful guy, the president of Americans for Tax Reform. He's - his mission in life is to drive down taxes, to make taxes lower. And he's called this program a government money grab. He basically says, you know, people wouldn't fight with the IRS, and they'd wind up paying more taxes, which he doesn't like.
KESTENBAUM: Goolsbee wrote about this idea of the government filling out people's tax forms back when he was just a professor. He thought, hey, there's this great, simple thing; let's do it. And then, he went to work at the White House.
GOOLSBEE: Well, you know, in Washington, one thing you learn is that if something doesn't have a powerful advocate, it's going to have a hard time progressing. And if you've got powerful enemies, you're really going to have a hard time progressing. And things like this, that are how can we simplify the tax code, end up running into both sides of that problem. It's not that important to anybody that they're going to say, oh, I want to reform Social Security; I want to change, you know, America's defense policy, and I want to make a simple return for taxes. It doesn't make it into anybody's top three. And then you've got a group of people who say, we don't want it to be easy. We don't want taxes to be easy. I'm not super optimistic that they're going to voluntarily get up at the IRS and say, hey, you know what? We're going to just go ahead and start doing this.
KESTENBAUM: That sometimes is the problem with small tweaks. They're just never on the top of anyone's list, so they don't go anywhere.
GOLDSTEIN: Yeah, for all the tweaks we've talked about so far, it seems like just inertia is a pretty big deal, a pretty big reason why they're not happening. Francesca Gino actually has gone out in the world and tried to get people to put the signature at the top. And she said, you know, people love the status quo.
KESTENBAUM: Which brings us to our last tweak. This tweak is useful exactly at moments like that, when your plan to fix the tax forms doesn't work, when your plan to change the legal forms doesn't work.
GOLDSTEIN: Really in general, when anything doesn't go your way.
KESTENBAUM: That's what this tweak is for.
GOLDSTEIN: It comes from Megan McArdle. She's a columnist at Bloomberg View. And we're going to call her tweak, bet against yourself.
KESTENBAUM: Megan discovered the genius of betting against yourself back when she was in business school. She and her classmates were out at a bar. They were waiting to hear if they were going to get job offers from the places they'd interned at.
MEGAN MCARDLE: I'm out with a bunch of friends. And we've now been talking about the fact that we are not going to get - we might not get our jobs.
GOLDSTEIN: How are you feeling at that moment?
MCARDLE: Extremely anxious (laughter).
KESTENBAUM: Someone came up with the idea of creating a pool. Everyone would put in 50 bucks. And if you do not get a job offer, you get the money in the pool. If multiple people don't get jobs, those people will split the pool. It's not like the winner gets it. The loser gets it.
GOLDSTEIN: There's a technical term for betting against yourself. It's called a hedge. And McArdle says hedging is great. She says everybody should do it in all kinds of settings. Bet against yourself - not a lot, just enough to take the edge off.
MCARDLE: Then, when something bad happens, you've got that little psychological backstop, you know, like, I won money. Everyone loves winning money.
KESTENBAUM: If you're a sports fan and there's a really big game coming up, she says bet against your own team. You can do this with all kinds of stuff, she says, even really personal stuff.
GOLDSTEIN: Find a friend. They will bet on you. You can bet against yourself.
MCARDLE: One example is if you are - if you're going to propose to your girlfriend. You're not quite sure she's going to say yes. That would be an excellent time.
GOLDSTEIN: (Laughter) You are making a bet, before you propose...
GOLDSTEIN: That your girlfriend is going to say no, is going to reject you. That's your advice.
MCARDLE: Yes (laughter). That is something you could do, yes.
GOLDSTEIN: Who - who would do this? Like, what kind of person, at this key moment in life, would bet against themselves? It makes sense. But it feels wrong, right? It feels wrong for, like, the super fan to be voting against their team. I mean, why do you think that is? Why do you think it feels wrong?
MCARDLE: Human beings, if you think about how we evolve - right? - we evolve in these small groups. And one of the biggest things that these small groups worry about is loyalty.
GOLDSTEIN: We as human beings are sort of built to be loyal. And betting against yourself or betting against your team is disloyal.
GOLDSTEIN: Megan says there are times when you should not bet against yourself. You know, for example, if you're a professional athlete, do not bet against your team. That's against the law. If you're actually married, do not bet against your marriage. It screws up the incentives.
KESTENBAUM: But if you are, say, in graduate school and worried that you might not get that job offer, that is a great time to bet against yourself. It worked for her, sadly.
MCARDLE: I did not get a job offer from the place where I'd interned.
KESTENBAUM: But she did get the money from the pool.
MCARDLE: I got enough money to take myself to a pretty nice dinner. And it did - it really - it was funny how much that lessened the sting because now, instead of just thinking, oh, this is terrible; I didn't get a job offer, I had something nice to think about at the moment when I needed it most.
GOLDSTEIN: So tweaks are hard to make happen. The status quo is really powerful. But one good thing about this tweak, about betting against yourself, you don't need an act of Congress. You don't need some big company to do anything. This tweak, it's on you.
KESTENBAUM: Jacob, I like this tweak. I'm not going to do it.
GOLDSTEIN: No, there's no way. I'm not going to do it either (laughter).
(SOUNDBITE OF PHOENIX SONG, "CONSOLATION PRIZES")
GOLDSTEIN: Send us your tweaks. We are at firstname.lastname@example.org. You can tweet your tweaks at me, @jacobgoldstein or at us, @planetmoney, or at you, @dkestenbaum. Our show today was produced by Nadia Wilson with an assist from Jess Jiang. And NPR recommends that you listen to...
GOLDSTEIN: Oh, StoryCorps.
KESTENBAUM: StoryCorps, guaranteed to make you cry in three minutes or less. You can find the StoryCorps podcast at npr.org/podcast. I'm David Kestenbaum.
GOLDSTEIN: And I'm Jacob Goldstein. Thanks for listening.
(SOUNDBITE OF SONG "CONSOLATION PRIZES")
PHOENIX: (Singing) No consolation prizes. Spit out your lies and chewing. Cut off your hair. Yeah, that's it. If you look like that I swear I'm going to love you more, more, more, more, more, more, more, more, more...
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