Sludge theory

Sludge in behavioral economics refers to any form of design, administrative, or policy-related friction that systematically impedes individuals' actions or decisions.^[1][2][3] It encompasses a range of frictions such as complex forms, hidden fees, and manipulative defaults that increase the effort, time, or cost required to make a choice, often benefiting the designer at the expense of the user's interest.^[1][4][5]

The concept of sludge highlights the importance of transparent and user-friendly design in promoting welfare, efficiency, and equity in decision-making processes.^[1]

Sludge was popularized by behavioral economist Richard Thaler and legal scholar Cass Sunstein. They introduced it as the "dark cousin" of nudging in their book Nudge: Improving Decisions About Health, Wealth, and Happiness.

See also

• Nudge theory
• choice architecture
• Red tape