Lesson Plan

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Lesson Plan
Grade: Date: 17/01/2026
Subject: Economics
Lesson Topic: behavioural insights and ‘nudge’ theory
Learning Objective/s:
  • Describe the main types of market failure and the traditional fiscal or regulatory interventions used to correct them.
  • Explain core behavioural concepts such as bounded rationality, loss aversion, status‑quo bias and social norms.
  • Analyse how specific nudge tools reshape choice architecture and evaluate their effectiveness and ethical considerations.
  • Apply nudge principles to design a low‑cost policy intervention that addresses a real‑world issue.
Materials Needed:
  • Projector and screen
  • Slide deck summarising market failures and nudge tools
  • Printed handout of the nudge‑tool table
  • Case‑study worksheet (energy‑consumption example)
  • Markers and whiteboard
  • Online poll/ clicker system for quick checks
 Introduction:
Imagine you could cut household energy use without raising any taxes. Students will recall a market failure they have studied and discuss how governments have traditionally responded. By the end of the lesson they will be able to compare conventional interventions with behavioural nudges and create a simple nudge proposal.
Lesson Structure:
  1. Do‑now (5'): Think‑pair‑share on a recent news story illustrating a market failure.
  2. Mini‑lecture (15'): Review types of market failure and traditional government tools.
  3. Concept mapping (10'): Introduce behavioural economics concepts and the definition of a nudge.
  4. Case‑study activity (20'): Groups analyse the carbon‑emission reduction example, identifying default, framing and social‑norm nudges.
  5. Whole‑class debrief (10'): Groups present findings; discuss effectiveness and ethical issues.
  6. Design sprint (15'): Each group drafts a brief nudge proposal for a new policy area using the tool table.
  7. Exit ticket (5'): Write one way a nudge could improve resource allocation in the classroom or community.
Conclusion:
We recap how nudges complement traditional fiscal policies by reshaping choice architecture while preserving freedom of choice. Students submit their exit tickets, which serve as a quick retrieval check. For homework, they will write a 300‑word evaluation of a real‑world nudge policy, considering both cost‑effectiveness and equity.