 Hello friends, my name is Dilip Pratap Singh Chakawat, I have secured all India ranked 72 in civil service examination 2018 and in this video I will be discussing the chapter 2 of economic survey volume 1. The chapter 2 is policy for Homo sapiens not Homo economicas leveraging the behavioral economics of nudge. So, this is a chapter related to nudge economics which recently also 2 years back also won the Nobel prize in economics and the basic concept behind this chapter is to bring out a favorable behavioral change in the people to for a desired outcome in certain policies. So, this is actually a combination of economics plus psychology plus human psychology. So, in this chapter we will look forward into the various ways how to nudge the public behavior into a desirable outcome. Now certain moves have been identified in this chapter of the economic survey that is from Beti Bacha, Beti Pradhao to Badlau that is Beti Apki Dhan Lakshmi or Vijay Lakshmi from Satshwara to Sundarbhara then we have from give it up subsidy in the LBG to the think about the subsidy for the people and from tax evasion to tax compliance. So, these are the 4 basic themes in which the chapter has been focusing how to produce a desirable behavior in the people for this shift. So, now in India it has in the context of India it has been stated that in India social and religious norm play a very important role in diverting the behavior of people towards a certain outcome because we have the fear of our society, we have the fear of religion in the people which can nudge the people's behavior into a desirable direction. So, this is one thing secondly also the nearly costless act of changing the default behavior to desired behavior can be encouraged. Now, if there is no cost involved for example in Beti Bacha or Beti Pradhao it is only a campaign in which we are promoting through various media and the social media, we are promoting how to save the girl child, how to educate her, the benefits of educating a girl child in the society. So, this is very costless kind of campaigning which the government is doing which can really help people to behave in that direction because there is no cost involved from the people side. So, this is again very important norm. The third is that in any case a sustained behavior is required for a long term solution of a particular problem. So, for that repeated reinforcements and reminders have to be sent as a message to the people of successful past actions which can help sustain changed behavior for a longer duration. So, these are basically the three modes in which a desirable outcome can be reached when worked upon. Now, there is a certain continuum given in this chapter of the economic survey the influence spectrum of the public policy. Now, it goes from lazy sphere to nudge to incentivize to mandate. So, this is a four step approach in which we move towards coercion and as Indian economy when we were liberalized in 1991 we had this lazy sphere approach in which markets and the society was given full freedom to do their own things. Now, we are moving towards nudge to generate a favorable behavior in the people so that it turn it helps in the development of the nation. So, that is again a shift from lazy sphere to nudge economics. Now, here in this chapter of the economic survey certain successful case studies have been analyzed in detail and the impact of nudge economics in the schemes have been really brought out very profoundly. So, the first example is the Swachh Bharat mission. Now, in Swachh Bharat mission it is very important to note that this is a successful campaign which is run by the government of India and it has become a Jan Andolan it has become a people led movement and hence the success rate is very high in the scheme as we have nearly 100 percent toilets have been constructed in all the states and the usage of these toilets is around 96.5 percent. So, this is a significant achievement hence this become a successful case study in which we can understand certain dynamics of behavioral economics. Then because if we take the example of Swachh Bharat mission we have envisaged 5 lakhs Satyagrahis the government has envisaged 5 lakhs Satyagrahis which will become foot soldiers to take forward this IEC campaign in villages, in rural areas, in towns, cities, etc. So, these people become the brand ambassadors of this program which will communicate good habits to the people which will communicate the harms which are associated with open defecation, the protection which is required for the girls because there are many security reasons also associated with women defecate in open. So, there are various roles which these Swachhagrahis do now these Swachhagrahis also are very important because when you give a person a certain amount of responsibility he always takes his own stake in the success of a program. So, this again is a very important reason by Swachh Bharat Avyan has become a mass led movement and eventually became a success. So, an important role has been played by these 5 lakhs Satyagrahis and then since it was a community led effort then the people also they conform naturally because they have the fear of society because we see that our neighbors have constructed toilets and they are using it and they have then away with open defecation other people in the neighborhood they also follow the same norm. So, because this is towards a desirable behavior this is towards a thing which has to be done a thing which is positive. So, people generally inclined towards it because they have the fear of society in their mind. So, this again it becomes a very successful case study then if we talk about the second example which is mentioned in the economics survey that is the Beti Bhadav Avyan in this again various tools of behavioral economics has been used. For example, when this scheme was expanded to all the districts in the country from Jhunjhunu the date chosen was 8th March 2018 and that was International Women's Day. So, this again becomes a significant message to the people that through this scheme the government is also emphasizing the empowerment of the women we are also moving towards women led development. So, that date becomes very very important and also the place again becomes important because Jhunjhunu district in Rajasthan was chosen because an improvement of 34 points in the sex ratio of that district has been registered in the past 6 to 7 years from 2011 to 2018. Hence, the improvement of sex ratio improved to 922 girls out of 1000 boys. So, this again is a significant improvement and this social messaging actually goes forward into the minds of the people and then people themselves they come forward take this take in the scheme and then help the scheme become a success which is already we can see that the enrollment ratio of girls has increased now the sex ratio in those districts in which the scheme was earlier implemented is improving very fast and now in other districts as well as the scheme has been launched to all the parts of the country. So, this is how this chapter presents these two successful models of behavioral economics which we can present as a case study for other schemes of the government to generate successful to generate a desired social behavior which can help make the scheme more productive which can help achieve the targets. So, this is important then there are certain elements which are required in this behavioral economics to get the desired result. The first is the power of clear messaging the message should be laid out very very clear for example, I will tell you a scheme Namami Ganga which is mentioned in this economic survey. Now, Namami Ganga means I pray to Ganga now Ganga River in India is revered as a very holy river and it is also worshipped in many places in India. So, when we give the scheme the name of Namami Ganga it becomes very appealing to the people they consider a stake in the Ganga and they also make efforts to fight the pollution which is rampant in the Ganga River. So, hence this behavioral economics was used by formulating the name of the scheme and the name of the scheme also plays a very effective role in its popularity when the scheme will be popular it will reach the people it will find coherence in the people's minds people will come forward takes take in the scheme and then move forward to clean the river Ganga. So, this was a very classic example of clear messaging. Now, other examples of clear messaging are Portion Abhiyan where Portion means holistic nutrition then we have the Jandhan Yojana in which Jandhan means money of the people. So, these schemes basically the naming of the schemes have been done in a very very advanced manner the psychology of human beings the psychology of people of India has been thoroughly studied before coming out with these kind of names which appeal to the people and hence are a very major reason behind the success of the schemes. Now, the next part of the chapter 2 it discusses certain biases which be as human beings have for example, we have anchoring bias we have failure bias failure means we have the fear of failure if certain scheme fails then we have a sunk cost bias whether we invest in any kind of thing for example, if we invest in the girl education and then we have to marry her her education goes to a waste. So, that kind of thinking is also prevailing in India and then we have a law subversion bias and the final is the flawed mental models and confirmation bias. So, these five kind of biases have been given and against it the economic survey brings out certain principles which have to be followed to remove these bias from the human beings and the to make the thinking of the human beings crystal clear. So, the following principles have been mentioned in this economic survey leveraging default rules then the principle 2 is making it easy to choose for the people. And the third is emphasizing social norms principle 4 is disclosing outcomes principle 5 is reinforced repeatedly as we have discussed earlier principle 6 is leverage loss aversion that a person needs to be communicated that if he is paid taking stake in a certain scheme he does not have to bear any loss. So, that is again a very important principle then principle 7 is make messages match mental models. Now, messaging is also be done in a certain way in which we human beings have a certain thing in our mind of our own that we connect to that messaging and then we move towards a certain desired behavior we move towards action. So, these are basically the seven principles which has been invasoraged in the economic survey to remove these kind of biases which you have discussed earlier. Now, the next section of this chapter is an aspirational agenda for path making change. Now, this is very important area in which is discussed in this economic survey which is also relevant for the ethics paper that is general studies paper 4 because it invasorges a citizen of India at 75 years of independence using behavioral economics to avoid the seven social sins of Mahatma Gandhi. Now, the seven social sins of Mahatma Gandhi are politics without principle wealth without work pleasure without conscience knowledge without character commerce without morality science without humanity worship without sacrifice. So, these are some of the very main sins which are pointed out by Mahatma Gandhi and the behavioral economics agenda going forward for the citizens of India must be that we should disincentivize people to move towards these sins and to free people from these sins again certain principles which you have discussed earlier have been mentioned it has been invasorged in this economic survey now to avoid these seven social sins which are mentioned by Mahatma Gandhi we have to move towards certain principles and those seven principles which we have discussed earlier like leverage loss aversion then disclosing outcomes leverage default rules match messages to mental models emphasizing social norms making it easy to choose reinforce repeatedly. So, these certain principles have been mentioned in this economic survey which can help us help our citizens to move away from these sins which are mentioned by the Mahatma Gandhi. So, then moving forward a very classic example of how we can move forward. So, a very specific guideline has been given which can be followed to move from Beti Bachow, Beti Pradhao to Badlao. So, the point A is to explicitly state the new norm of gender equality now this is an example of clear messaging which has been mentioned in one of the principles earlier. Second is to focus attention on all those who adopt the new norm now the people who are adopting this new norm of Badlao they have to be focused upon they have to make we made the brand ambassadors like we have seen the example of Sakchagrahi's which played a very phenomenal role in the success of the Swachh Bharat Abhiyan and the third step is to continuously reinforce the norm over time. Now, as we have seen that in the case of Beti Bachow, Beti Pradhao also like selfie with daughters these are certain instruments through which this norm has been reinforced again and again minds of the people. So, this again becomes very important for the success of a particular scheme and now what kind of behavioral principles have we have to be used to make Badlao a reality. Now for this also certain behavioral principles in this chapter has been mentioned which I will state make it easy to choose emphasize social norms disclose outcomes reinforce repeatedly leverage loss aversion make messages match mental models. So, these are the principles we have already talked about if we follow these principles and if we follow the above mentioned three guidelines we will be able to take Beti Bachow, Beti Pradhao to Badlao that is Beti apki Dhan Lakshmi or Vijay Lakshmi. So, going forward now we come to the conclusion now the conclusion is very significant and which can be a very important source of value addition if a certain question is asked this year Indian economy part that the first proposal which is given by the economic survey is to set up a behavioral economics unit in Niti Aayog which must be immediately activated this is very important because now even if with the naming of the schemes and till the scheme produces desired results behavioral economics is one which has to be repeatedly re-engoverated re-think upon to make the scheme a success. So, this division has been sought out by the economic survey in the Niti Aayog. Second is every program must go through a behavioral economics audit now this is again a very innovative thing which has been thought after by the economic survey this year that a behavioral economic audit has to be done if a scheme does not follow certain principles which have been mentioned in the behavioral economics section which we have discussed earlier then it again can be re-planned it can be changed with time to incorporate certain principles of behavioral economics so that it produces that desirable change in the people and hence it becomes a participative development model going forward which is very important for the success of a particular scheme. And the third is as several programs are administered by state governments behavioral economics teams can work with various state governments not only to inform them about the potential benefits but also help them to improve the efficacy of these programs this point stipulates the model of cooperative federalism because there are many state governments which have their own schemes which are being implemented from the time of the independence now that also has to be taken care of their behavioral audit has to be done and then again Niti Aayog can play a very definite role in this arena in which states can also be encouraged to have behavioral economics units in their own secretariat which can play a role in audit of these schemes and again re-incorporate these principles so that a desired social change is brought out in the people hence leading to the success of the scheme. So this was chapter 2 of economic survey thank you.