Autumn: Hey everyone, welcome back to the show! Ever scratched your head wondering why some motivational tactics just completely bomb? You know, like when rewards for doing the right thing somehow encourage the “wrong” thing? Rachel: Oh, you mean like when the company preaches "teamwork," but then promotes the guy who steals everyone’s ideas? The mixed signals are deafening! Autumn: Precisely! That's exactly what Mixed Signals: How Incentives Really Work by Uri Gneezy is all about. It’s a deep dive into the psychology behind why incentives work, or, more often, why they don't. And more importantly, how they can unintentionally send conflicting messages. Rachel: So, it's not just about the usual bonuses and benefits. It's about understanding the message behind the incentive, whether those messages are intentional or not. Autumn: Exactly. And Gneezy uses all these fascinating case studies and experiments. This isn't just dry theory; it's practical stuff you can use whether you're running a business, raising kids, or tackling social problems. Rachel: Alright, and today we're going to tear this thing apart with five key ideas. First off, signaling: why driving a Prius might say more about your image than your carbon footprint. Autumn: Then, we'll get into the blunders—like those call centers that accidentally reward terrible customer service. Rachel: Then there's the psychological twist: why simply avoiding losing a bonus is way more motivating than actually earning one. Autumn: We’re also talking transparency, like Amazon’s 'Pay-to-Quit' program. It’s a pretty clever tool that shows who's “really” committed to the company. Rachel: And last but not least, the global perspective: How Kenya is fighting harmful traditions, like female genital mutilation, using education-based incentives. Autumn: These stories “really” show you how you can decode the hidden language of incentives – and how to speak it fluently. So, let’s jump in!

Autumn: Okay, so let's dive into signaling, right? Starting with credible signaling and how it shapes what people think. Honestly, this is the foundation of everything we're going to talk about. If you get this, the rest of the incentive stuff just kind of falls into place. The basic idea is super simple: a signal only matters if it's believable. And that believability usually comes from some kind of cost or sacrifice attached to it. Rachel: Cost, huh? So, you get what you pay for, basically? Makes sense. But what does that “really” mean? When we say a signal's credible, are we just talking about money, or is there more to it? Autumn: Definitely more! It's about the sacrifices, the things that make a signal real, whether it's money, or how it looks to other people, or even how it makes you feel. Gneezy talks a lot about "costly signaling" to explain this. Think about it this way: if something takes effort, resources, or shows you're really committed, it'll scare off the fakers. That's why it's so effective. Rachel: Okay, I'm tracking. The pricier it is, the harder it is to fake? So, real-world examples, please. Autumn: Okay, think about Toyota with the Prius. Back in the late 90s, early 2000s, they didn't just sell it as fuel-efficient. It looked super eco-friendly. Like, the design wasn't just for show, it was shouting, "Hey, I care about the environment!" Gneezy points out that people were actually willing to put up with less performance and comfort just to drive a car that showed off their values. Rachel: Right, so the design became this badge of honor, like "I'm saving the planet, one hybrid at a time!" Autumn: Exactly! It was costly in a couple of ways. There was the money, because Prius owners often paid a little extra, and then there was the fact that the car wasn't exactly a sports car. But for a lot of buyers, it wasn't about the specs; it was about their image, what they stood for. And the design just amplified that message. Rachel: So basically, Toyota nailed the fuel-efficiency thing without making it look like some boring family sedan. Honda's Insight...not so much? Autumn: Well, it wasn't a total failure, but it just couldn't keep up with the Prius. It looked too much like every other car, so it didn't really signal anything. Gneezy argues that the lack of a standout design undermined the signal’s credibility. Without that, you know, "Look at me, I'm different!" vibe, Honda missed out on the green wave that Toyota caught. Rachel: Which makes you wonder, how much of the Prius's success was actually about performance, and how much was just...ego? Were people really saving the planet, or were they just trying to get social points? Autumn: That's the really interesting part. Studies in the book show that over half of Prius buyers—57% to be exact—said their main reason for buying was to make a statement about who they are. So yeah, it was more about showing off than cutting emissions. But, here's the cool thing: ego or altruism, it didn't really matter. The end result was the same: more people driving hybrid cars, which is good for the environment. Rachel: Huh. Signaling is less about being a good person and more about what happens because of it, even if you're being selfish. Okay, I get it. But signaling morality is one thing, and consumer behavior is one thing. What about changing deep-rooted cultural traditions, like in the Maasai example? That seems like a whole different ballgame. Autumn: Totally, and that's where Gneezy brings in the Simba Project. The goal was to shift the Maasai community away from hunting lions, which was a huge part of their culture and identity, and toward protecting them for conservation. Basically, they had to rethink how incentives worked in that situation. Rachel: Right, these warriors weren't just hunting lions for fun. It was about bravery, responsibility, protecting their community. How do you replace a signal like that? Autumn: By creating a new one. The Simba Project started compensating people for livestock that lions killed, but only if the lions were left unharmed. Suddenly, lions were worth more alive than dead. The other important thing is that they had trained officers verifying everything to make sure no one was cheating the system. This made the program very credible. Rachel: Okay, we're talking real stakes now. It's not just changing a habit; it's changing an entire identity. These warriors had to give up something that was core to their social structure. That's a big ask. Autumn: Exactly, and that's why it worked! It was a "costly signal" of conservation. Giving up lion hunting wasn't easy, and that sacrifice showed how committed the community was to the new system. Plus, the money they could make from eco-tourism made the change worthwhile right away. The "Simba Scouts," as they're called now, protect the lions instead of hunting them and have become total role models. Rachel: So, the Maasai basically became the Prius drivers of their ecosystem, signaling a change through visible, credible actions. And their community shifted because the incentives aligned with their values. Makes sense. Autumn: Exactly! Both the Prius and the Simba Project highlight this key lesson from Gneezy: for a signal to work, it has to be visible, tied to some kind of cost, and make sense within the culture. When incentives and credible signals line up, that's when you get real, lasting change. Rachel: Wow. Signals go from being just shallow gestures to something that can really change the world. Okay, next time I see a Prius, I'll give the driver a nod. They're part of a big behavioral experiment! Autumn: Definitely! And when it's done right, those experiments can reshape industries and even long-held traditions.

Autumn: So, after establishing the importance of credible signals, we’re going to dive into recognizing and dealing with mixed signals. These are the signals that contradict what people say they want. Detecting and correcting these situations, according to Gneezy, can “really” help prevent negative outcomes. He transitions from theory to real-world application here, pinpointing flaws in incentive design and bringing in those key psychological insights. Rachel: Ah, mixed signals. You mean, like, when someone tells you one thing but their actions tell you another? It's that whole "do as I say, not as I do" vibe, right? That’s a recipe for confusion. Autumn: Exactly. Gneezy focuses on how organizations and systems can unintentionally send these conflicting messages. If the stated goals don’t match the rewards, people get confused, or worse, they end up being rewarded for behaviors that actually undermine those goals. And that can have serious consequences. Rachel: So, it's like telling your team teamwork is crucial, but then giving the biggest bonus to the guy who hoards all the resources and never shares. How exactly do you fix a situation like that? Autumn: Well, it starts with figuring out what’s wrong. Often, the problem is in how we measure success. Gneezy points out systems that focus too much on one thing, like how fast customer service reps are, or short-term profits for a company, at the expense of things like quality or innovation. Rachel: Okay, let’s get practical. Can you give me an example? Autumn: Sure. Take call centers, for instance. A lot of them pay employees based on the number of calls they handle per day. Sounds efficient, right? But what happens? Agents start rushing through calls just to get to the next one, instead of actually solving the customer’s problem. Rachel: Okay, I can picture it. Someone’s been on hold forever, finally gets a rep, and the rep is just trying to get them off the phone as fast as possible. The customer ends up even more frustrated and has to call back again. Is that the idea? Autumn: Exactly. The system sends a mixed signal. The company might say customer satisfaction is their top priority, but their metrics tell a different story. The real message is: "Your speed matters more than whether the customer is happy." And, of course, it creates a bad cycle where poor service leads to unhappy customers, hurts the company's reputation, and makes the employees miserable, which leads to them quitting. Rachel: Yeah, if the agents don’t get any credit for actually solving problems, they’re going to stop caring. They’ll think, "Why bother?" and that’s the end of their motivation. Autumn: Right. Gneezy suggests changing the incentives. For example, you could include customer satisfaction surveys or feedback scores in the performance reviews. That would encourage agents to focus on making the interactions meaningful as well as being efficient. By matching the rewards with the actual values, you send a clear message that quality matters. Rachel: Okay, so companies need to practice what they preach. But that’s pretty straightforward. Let’s talk about Blockbuster. What was their mixed signal? Autumn: Perfect example. Blockbuster claimed they cared about customer loyalty and satisfaction. But they made a huge amount of their money from late fees. And when Netflix offered them a subscription model, with no late fees and more convenience, Blockbuster turned it down. Rachel: So Blockbuster was talking about making "movie night" better, but their actions were all about charging people extra. I’m guessing customers didn’t miss that? Autumn: Nope. Gneezy says that this difference between what they said and what they were doing is what drove customers away. Netflix, on the other hand, sent a consistent message: "We value your convenience." Blockbuster's decision to not adapt not only reinforced their mixed message but also showed they weren’t willing to innovate. Rachel: Basically, Blockbuster was too attached to their cash cow—late fees—even though it was hurting their ability to compete. They prioritized short-term profit over long-term growth. It’s a classic business mistake. Autumn: And the result? Netflix, a younger, more adaptable company, took over the market by aligning their incentives with customer priorities. Blockbuster is now a cautionary tale about how mixed signals can ruin a company that doesn’t adapt. Rachel: So the big lesson is this: Whether you’re running a call center or a huge corporation, if your goals and your metrics don't match, you’re basically giving your competition the keys to your downfall. It sounds like a preventable disaster. Autumn: Exactly. Avoiding mixed signals often means making tough choices—maybe even giving up some short-term profits. But when companies align their incentives with their core values, they build trust, loyalty, and, ultimately, resilience. Rachel: Makes sense. When what you say and what you do line up, you build credibility, and that’s everything.

Autumn: Okay, so now that we've seen what happens when these mixed signals go wrong, let's dive into the psychology behind why incentives work or fail. We're moving from individual behavior to the bigger picture, seeing how incentives can be both tools for understanding a situation and ways to change it. Ready to explore what makes an incentive system tick? Rachel: Yes! Time for the psychological deep dive! I'm guessing we're going to uncover all those weird human tendencies that make us obsessed with rewards, but even more driven by the fear of losing something. Autumn: Absolutely! Uri Gneezy really gets into the cognitive biases and emotional responses that drive motivation. Two biggies here: loss aversion and the warm glow effect. They affect how we react to incentives in completely opposite ways, but both have a huge impact. Rachel: Loss aversion and warm glow—I like those already. So, is this just a classic carrot-and-stick situation? Or is there more to it? Autumn: Oh, way more. Let's start with loss aversion. Kahneman and Tversky really nailed this one: we hate losing something we have way more than we enjoy gaining something new. Gneezy uses this to show why framing incentives as potential losses is often more effective than dangling them as potential gains. Rachel: Okay, unpack that a bit. Why does the fear of losing hit so hard? Is it a primal thing, like losing food feels like a threat to survival? Autumn: Almost exactly! It's a really deep-seated psychological thing. We're wired to avoid losses because the potential pain of losing is emotionally stronger than the joy of gaining the same thing. That's why this principle is such a big deal in behavioral economics. Gneezy talks about experiments where framing bonuses as losses made people perform way better than when they were presented as rewards. Rachel: Right, right. I need a real-world example to make this click. Autumn: Perfect timing! There's this experiment with teachers and student performance. It's a great example of loss aversion in action. They split teachers into two groups and rewarded them based on how well their students did on standardized tests. One group was offered an $8,000 bonus at the end of the year if their students hit certain goals. Rachel: Standard carrot approach. What about the other group? Autumn: The second group got the bonus upfront—$8,000 deposited right into their accounts at the beginning of the year. But, they were told they'd have to pay back some or all of it if their students didn't meet the targets. Rachel: Ouch. Now that's pressure! Once you see that money in your account, the stakes get real. Let me guess, the loss-framed teachers killed it? Autumn: Exactly! The students taught by that group made significant gains, improving by about ten percentile points. That's like switching out an average teacher for a top-tier one. The fear of losing what they “owned” drove them to really go the extra mile. Rachel: Makes total sense. Nobody wants to give back eight grand! But here's what I'm wondering: was that fair to start with? I mean, were teachers penalized for things beyond their control, like socioeconomic stuff or student absences? Autumn: That's a very fair point, and Gneezy does address it. For incentives to work, they have to be fair and realistic. If you're using loss aversion tactics, the goals and expectations have to be clear, achievable, and fair. Otherwise, you'll just end up with resentful and burnt-out people. Rachel: Got it. So, it's high-risk, high-reward. Brilliant if you get it right, but a major mess if you're sloppy. Now, let’s switch gears a bit. This "warm glow" effect you were talking about—what's that all about? Autumn: The warm glow effect is that happy feeling people get from doing good. It's all about tapping into intrinsic motivation. Instead of focusing on what you gain or lose materially, warm glow incentives connect to a person's sense of purpose, community, or just plain kindness. It's the joy of giving, not getting. Rachel: So, it's basically the "it feels good to be good" principle. But is that kind of... fuzzy? How do you build a practical incentive around feelings? Autumn: That's where it gets interesting. Gneezy mentions how Pret a Manger does its employee bonuses. Instead of just handing out cash, they give employees funds to distribute to coworkers who helped them succeed. This boosts teamwork and taps into the warm glow effect—it makes employees feel good to show gratitude. Rachel: Clever! Pret is basically rewiring the reward system in the brain to value teamwork over individual glory. Instead of everyone fighting for the biggest bonus, it's more like, "Hey, who helped me out on that crazy shift last week?" Autumn: Exactly! It creates a ripple of positive feelings. And the act of giving becomes its own reward. Gneezy points out that this system addresses a basic human need: the need for social connection and being appreciated. And because it's tied to feeling good inside, rather than just getting money, the motivation tends to last longer. Rachel: I like this! Sounds more sustainable than just dangling money all the time. Does this work everywhere, or is it better for certain types of organizations or cultures? Autumn: That's a great question. Warm glow incentives work best in places that value collaboration and community—like Pret, or a nonprofit org. They might not do so well in super-competitive workplaces where it's all about individual gain. You really have to think about the context and culture to make something like this work. Rachel: Okay, so loss aversion is good when the stakes are high and everyone knows where they stand. Warm glow works when teamwork and personal connections are key. It’s like having two psychological tools, each best for certain situations. Autumn: Precisely. Whether you're encouraging people to avoid losses or fostering a sense of purpose through the act of giving, understanding these psychological levers helps organizations design incentives that truly work. And when used right, they can reshape industries, or even redefine social norms.

Autumn: So, with these psychological tools in hand, let's dive into how incentives can help us spot problems in big systems and actually make society better. Rachel: Okay, this is a cool jump. So, it's not just about individuals or companies anymore, but the whole system. You're saying incentives, when done right, are more than just a pat on the back. They're like, uh, societal MRIs, showing us the hidden issues? Autumn: Exactly. It's less about handing out rewards or punishments and more about using them to figure out why things aren't clicking. What's “really” going on? Rachel: Gotcha. So, incentives can tell us if the problem is people just don't care, or if it's something blocking them, or even some big problem in the system itself. Okay, how does this work? You mentioned education and the PISA test with U.S. students. Autumn: Right. Those global rankings seemed to show American students as just okay, right? Like, ranked 36th in math, behind a lot of countries. Rachel: Yeah, a lot! So, the first thought was that American students just weren't as smart as students in places like China or Singapore. And tons of money went into changing education. But some researchers wanted to dig deeper: Was it “really” about ability? Or was something else going on? Autumn: So, their tool was incentives. They decided to see what would happen with some money on the line. Rachel: Aha! Autumn: People like John List brought money into the experiment. They offered U.S. students cash for doing well on the test. And guess what? Their scores went way up, almost closing the gap with students in Shanghai, who, by the way, already have a culture of high stakes. Rachel: Wow. So, the kid who seemed bad at math suddenly does great when there's cash involved. It wasn't about being bad at math, just not trying! Autumn: Exactly. This way of using incentives showed that the PISA tests didn't “really” matter to U.S. students—no grades, no personal consequences—so they didn't bother trying. Students in Shanghai probably felt pressure from their families and society, but American students didn't have that. Rachel: Yeah, that makes sense. I mean, if there's nothing to win or lose, why would teenagers spend three hours on math problems? TikTok's calling. Autumn: Exactly. And this also warns us not to only use these tests to judge how good our schools are. We need to think about effort and motivation too. Gneezy warns us about misinterpreting what these signals “really” mean. Rachel: Okay, so in education, incentives were like an X-ray, showing us things like student motivation. Now, let's talk about work. What's this "Pay-to-Quit" thing at Amazon? Sounds intense. Autumn: It is! Amazon basically flips the script on keeping employees. Every year, they offer people money to quit—starting at $1,000 and going up to $5,000. But they don't “really” want people to leave. They want to see who's not “really” happy there. Rachel: Wait a sec. So, Jeff Bezos says, "Here's $5,000 to leave," but hopes they don't? That sounds like a game of poker. Autumn: It does seem weird at first. But it shows something important. When people take the money, it says, "I'm not happy here." And that tells Amazon something about their company. Are some offices making people unhappy? Are some jobs too stressful? It's like a checkup on how the company is doing. Rachel: And if people don't take the money, it's like they’re saying, "I'm here for the long haul," right? Autumn: Exactly. Saying no makes them even more committed. And studies show that people who turn down the money stay longer and do better work. They made a choice, which makes them like the company even more. Rachel: Okay, but what if someone cheats the system? Takes the $5,000, goes on vacation, and then applies for the same job again later? Autumn: That's a fair point. First, they have rules to stop that from happening. But also, the main point of this isn't to punish people. It's to learn something. It's not about catching people, it's about being honest. Employees who aren't happy can leave without feeling bad, and Amazon can figure out which departments or managers might be causing problems. Rachel: So, it's like a "get out of jail free" card for unhappy employees. But instead of guessing who's unhappy, Amazon turns it into data. I gotta say, that's smart for such a tough industry. Autumn: Exactly. And the main thing here, like with the PISA example, is being precise. Whether it's testing effort versus ability or commitment versus unhappiness, all of these show that incentives don't just change how people act. They show us what needs to be fixed in systems, rules, or even big ideas. Rachel: Okay, I get it now. Incentives aren't just about dangling carrots to get people to do stuff. They're these smart tools to figure out what's “really” going on. So, when they're done right, they don't just ask, "What can we reward?" but "What can we learn?" Am I getting it? Autumn: Exactly. And that change in thinking—from controlling to learning—is why using incentives to figure things out is so powerful. It's not just about making people behave differently. It's about understanding why they're behaving that way, and where the system needs to change to “really” make things better. Rachel: I like it. So, whether we're fixing math problems or work issues, incentives show us the “real” problems. Okay, Autumn, what's next in this amazing lesson?

Autumn: So, finally, let's talk about how well-designed incentives can actually dismantle harmful traditions and, you know, create a more equitable society. This brings us to one of the most compelling ideas in Gneezy's book – how to facilitate societal change. It's really the culmination of everything we've been discussing so far. It’s about incentives moving beyond individual behavior, beyond just organizational tweaks, to really driving collective action and long-term, lasting transformation. Rachel: Societal change, huh? That's... that's a tall order. So, we've gone from getting Prius drivers to signal their environmentalism to, now, completely rethinking entire cultural systems. No pressure, right? Autumn: Exactly! It’s about using incentives to realign really deeply held values and global, or community-wide, traditions. A perfect example in the book is Kenya’s fight against female genital mutilation, or FGM. They used education-based incentives to try and break a cycle that just seemed completely unchangeable. Rachel: Yeah, FGM is one of those age-old traditions that… it feels like trying to move a mountain. It's heartbreaking, because it's so deeply tied to social and cultural pressures. Wasn’t the core issue here about dowries? Autumn: It was. In many Maasai communities, FGM actually acts as a mandatory rite of passage for girls entering womanhood. Without it, a girl is often deemed unsuitable for marriage, which, of course, lowers her family's social standing and their dowry value. So, even when legal bans were introduced, a lot of families defied them, simply out of fear of being ostracized. Rachel: Right, because a law doesn't mean much when the social cost of following it is way higher than the legal penalty. So, Gneezy's point here… was it all carrot and no stick? Autumn: Precisely. Punitive measures, like legal bans, really had minimal impact because they didn’t address those underlying economic and social incentives. The real breakthrough came when policymakers reframed the whole equation, actually offering scholarships and school funding to families that refrained from FGM. Rachel: Wait, so hold on. Instead of punishing families for doing FGM, they just said, "Here's some money, and by the way, your daughters will now get an education if you skip it"? That's… that's clever. Autumn: It's brilliant, right? By tying education – something with long-term economic and social benefits – to avoiding FGM, families were introduced, for the first time, to an alternative. What really flipped the narrative was how that education redefined the value of their daughters, not just as marriage commodities through dowries, but as individuals with potential, future earnings and independence. Rachel: I can see how that starts to rewire the community's thinking. But how fast did it work? This isn't one of those "overnight success" stories, is it? Autumn: No, the change definitely took time. But a key shift was in how education really began to gain social legitimacy. Girls who avoided FGM, but excelled in school, showcased a completely different path to success. And families of these girls became advocates for the shift, turning what was once a taboo into a point of pride. It’s that critical mass effect that Gneezy emphasizes – small shifts snowballing into a larger community buy-in. Rachel: And what about the girls themselves? I mean, for ages, FGM has been associated with acceptance, womanhood, and even dignity, within these communities. How did those narratives around identity evolve? Autumn: That's where education really shone. Girls who were once under immense pressure to conform, were instead celebrated for their academic achievements. They could signal their maturity and worth through something far more empowering - a school diploma, rather than scars. For instance, Gneezy shares the story of Nangini, a girl who initially faced backlash for remaining uncut, but then later became a role model when she excelled academically. Rachel: So, Nangini becomes the poster child for this "new normal." And suddenly, success wasn't about earning a dowry, but about something bigger – a path towards independence. Autumn: Absolutely. And this example really underscores Gneezy's bigger point: Incentives are most transformative when they work with cultural dynamics, rather than against them. By harnessing a community's aspirations – in this case, valuing education – they created a sustainable pathway for change. Rachel: Okay, I see how this works in the FGM case. But let's flip to something totally different – something equally rooted in tradition, but more tied to, I don't know, nature? Like that Simba Project in East Africa. Because, you know, lion hunting isn't just a sport for the Maasai; it's a rite of passage. Seems like an even steeper hill to climb. Autumn: It was. For centuries, Maasai warriors hunted lions to prove their bravery and protect their livestock. It wasn't just a ritual; it really established their status and identity within the community. Unfortunately, this tradition was devastating wild lion populations, driving them to near extinction, while also undercutting eco-tourism revenues, that were crucial to the Maasai economy. Rachel: Right, so the stakes here were twofold: keeping ancient cultural roots intact, and saving lions from disappearing. Quite the balancing act. Autumn: Exactly. Enter the Simba Project, which flipped the incentive structure by attaching financial value to conservation. The program compensated elders for livestock lost to lion attacks – but only if the lions responsible were left unharmed. Rachel: Wow. Instant 180. So, for the first time ever, having lions near the village became a net positive? Autumn: That's the transformative part. By making lions economically valuable, the project shifted their status from being a “threat” to a “resource.” The tradition of lion hunts morphed into something new – former warriors rebranded as “Simba Scouts,” tracking lion movements and ensuring both livestock and wildlife coexisted peacefully. Rachel: So a practice rooted in courage and responsibility didn't just vanish; it just evolved into a more sustainable version of itself. That’s, that's genius. But what kept it from devolving into, you know, corruption? Like, I don't know, faking attacks to cash in? Autumn: Gneezy highlights this as a key element of the success: robust accountability. Trained officers verified livestock loss claims, and standards for proper livestock protection were established. This all ensured that the system rewarded responsible behavior, not, you know, fraud. Rachel: And the results? Did lion populations actually bounce back, or was this just a Band-Aid solution? Autumn: They bounced back dramatically. In some areas, wild lion numbers jumped from like, ten to sixty-five in just a few years. And with thriving lion populations came a boost in eco-tourism. That new revenue stream further incentivized conservation, creating a virtuous cycle. Rachel: So lions got to live, the Maasai's cultural identity updated itself, and eco-tourism brought in the cash. Win-win-win. Autumn: Exactly. It’s a really powerful example of incentives fostering alignment between economic, ecological, and cultural priorities. This is Gneezy’s big crescendo: when incentives stop being Band-Aids and become tools for systemic change. Rachel: So the moral of the story here is that incentives – when designed thoughtfully – aren't just about, you know, pushing individual buttons. They're about rewiring systems and values. Autumn: Precisely. Both the FGM education program and the Simba Project really demonstrate that incentives can dismantle deeply harmful traditions and replace them with sustainable practices. When aligned with credible signals and cultural values, they don't just nudge behavior, they redefine norms. Rachel: And that’s the kind of incentive revolution I can get behind. So whether it’s protecting lions or empowering kids, as Gneezy shows us, signals and incentives wield the power to transform worlds.

Autumn: So, there you have it. “Mixed Signals” isn't just about figuring out why incentives work, or flop. It's really about mastering the art of designing systems where what you do actually matches what you say—creating clarity, not a confusing mess. From Prius drivers trying to show they care about the environment to Maasai warriors changing their traditions, Uri Gneezy shows us that the key is all about being credible and making sure everything lines up. Rachel: Exactly. And when the incentives are off, or even worse, when they send mixed signals, you end up with call centers rushing through calls instead of actually helping people, or companies like Blockbuster sticking to old business models and missing out on innovation. The consequences might be different, but the lesson is the same: incentives reflect what you truly value, and they better match what you're trying to achieve. Autumn: Right, and they're also like diagnostic tools, shining a light on hidden motivations and systemic flaws. You know, whether it's using the fear of loss to motivate teachers or showing that U.S. students aren't necessarily underperforming, they're just underselling themselves; You can use incentives to really uncover what's going on and make meaningful changes. Rachel: And finally, incentives as tools for transformation—that’s the really interesting part. Whether it's breaking cycles of FGM in Kenya or redefining Maasai rites of passage to protect lions, Gneezy proves that well-designed incentives can actually shift values, reshape cultures, and rewrite social norms. Wow. Autumn: Exactly. So the big takeaway here? Signals and incentives are everywhere, shaping how we behave, restructuring the systems around us, and defining what we value. So, pay attention to the signals you're seeing. Understand the incentives you're setting. And when it's your turn to design them, remember, credibility, alignment, and thoughtfulness are really the keys to making it work. Rachel: So, for all you listeners out there, whether you're running a company, trying to make a difference in the world, or just wondering why your gym membership isn't motivating you, think about Gneezy's insights. Maybe the signals you're sending need a closer look, huh? Autumn: Alright, that's all the time we have for this episode. Thanks so much for tuning in, and until next time, stay curious, stay inspired, and keep an eye out for those signals!