Is more choice better? Ten years ago the answer seemed obvious: Yes. Now the conventional wisdom is the opposite: lots of choice makes people less likely to choose anything, and less happy when they do choose.

The most famous supporting evidence is an experiment conducted by two psychologists, Mark Lepper and Sheena Iyengar. They set up a jam-tasting stall in a posh supermarket in California. Sometimes they offered six varieties of jam, at other times 24; jam tasters were then offered a voucher to buy jam at a discount.

The bigger display attracted more customers but very few of them actually bought jam. The display that offered less choice made many more sales – in fact, only 3 per cent of jam tasters at the 24-flavour stand used their discount voucher, versus 30 per cent at the six-flavour stand. This is an astonishingly strong effect – and utterly counter to mainstream economic theory.

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I do not count myself as one of Jamie Oliver’s army of fans, but after looking at the chirpy chef’s antics through the eyes of an economist, I am starting to acquire a grudging respect for him. Yes, the recipe books are all but unreadable, but his “school dinners” campaign has been surprisingly successful.

Oliver’s mission to persuade schools to serve healthier lunches – and get children to eat them, and stubborn mothers not to stuff chips through the school railings – became a national phenomenon in 2005. Tony Blair and David Cameron fell over themselves to jump on the Naked Chef’s bandwagon, and soon everyone in the country had an opinion on the campaign.

What caught the attention of Michele Belot and Jonathan James, though, was the way Oliver’s project had been implemented. Belot and James – economists at Nuffield College, Oxford, and at the University of Essex respectively – noted that the campaign had created a near-perfect experiment. The chef had convinced Greenwich’s council and schools to change menus to fit his scheme; he mobilised resources, provided equipment and trained dinner ladies. Other London boroughs with similar demographics received none of these advantages – and indeed, because the programme wasn’t broadcast until after the project was well under way, probably knew little about it. The result was a credible pilot project. It wasn’t quite up to the gold standard of a randomised trial, but it wasn’t far off.

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Should managers be giving more frequent performance appraisals? Do “customer feedback” questionnaires serve any useful purpose? The answers are not obvious. A feedback-free environment is not conducive to learning new skills, but then again, feedback itself can be confusing or demoralising.

I suffered from both too little and too much feedback in my last year of school. That was when I decided to stop going to piano lessons, having been coasting lazily at a mediocre level for years. My piano teacher, who had maintained a tactful silence, wistfully remarked that I had a beautiful touch on the keyboard – better than any of her hard-working, virtuosic prodigies. I was not impressed. Had she said that five years earlier, I might have worked harder. (Or so I told myself.)

It was also the year that I decided to spend less time with my A-level Further Maths exercises and more time with my girlfriend. I judged that my modest mathematical skills would not deliver a grade I needed to get into university, which would have to come from some other subject. Getting a C was no more useful than getting an E. So I stopped working, duly got the E, and did indeed get into university by other means.

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A club sandwich, a pair of trousers, a ticket to the movies – in a typical market transaction, I choose and pay for my own desires.

Sometimes, however, I might buy something for someone else, and here trouble begins. If I am buying something – a goat, an HIV prevention course, a bit of paved road – for a complete stranger in a far-off land, the risks that something will go awry are far higher. How am I to know what is needed, where to send it, even whether it has been stolen en route?

This may be why we have aid agencies. Aid agencies are popular symbols of national generosity – witness the Tory commitment to ring-fence the Department for International Development’s budget, even as they speak of inevitable spending cuts elsewhere – and in principle should make better-informed decisions because they are in a position to put expert decision-makers on the ground.

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As the debate on healthcare drones on in the US, I have been struck by a heretical thought: the differences between the British National Health Service and the US healthcare system are not nearly as important as their shared weaknesses.

The difference between the two systems has been exaggerated of late. The uninsured in America are not barred from emergency rooms by security guards. The NHS has not assembled a death panel to do away with Stephen Hawking.

I’ve had experience of both systems. My wife’s life has been saved once by American doctors and once by British ones. One of my daughters was born in Washington, DC, the other in London. And I’ll admit that the systems feel very different. The outcomes are different, the bureaucracy works in a different way, the waiting times are different and the rules of access are different.

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At a recent conference on experimental economics, John List, professor of economics at the university of chicago, shared a beer with other delegates and opined, “I think I used to be the most hated guy in this field.” His drinking companions jovially assured him that he still was.

So why the sharp elbows from his colleagues? Quite simply, List’s attention to the nuts and bolts of experimental method has demolished some of the most cherished results in the cool field of behavioural economics.

Consider a class of experimental games much cited by those who dispute the classical model of rational economic choice. There is the “ultimatum” game, in which player A (Anna) is given $10 and asked how much, if any, she proposes to offer to player B (Bernard). Bernard can accept the offer, but if he rejects it, neither Anna nor Bernard get anything. If Anna and Bernard were rational income-maximisers, Anna would offer one cent and Bernard would accept it as better than nothing. This never happens, so Anna and Bernard are not rational income-maximisers.

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My daughters (average age: four) have a serious credibility problem. “Daddy, if you read just one more story, then we’ll go to sleep.” “Mummy, if you give me a snack now, I promise I’ll eat up all my dinner.” You know what, my darlings? We just don’t believe you, so there’ll be no extra story and no snack.

Such troubles are not solely the preserve of little girls. Managers promise performance bonuses, workers do not believe them, and so the hoped-for performance does not materialise. Governments promise to keep a lid on inflation, nobody takes them seriously, and that is one of the reasons the lid comes off.

These problems have solutions. Most adults build up enough of a reputation for honesty that their promises tend to be believed. Politicians delegate inflation management to central banks, which – despite recent travails – are both more credible and more successful inflation-busters.

Yet when it comes to climate change, few people are talking about time inconsistency. They should be. I can find no reason to take seriously any government promises on the subject.

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Behavioural economics, the application of psychological insights to economic theories and problems, has been growing in influence for decades. But with the publication of Richard Thaler and Cass Sunstein’s Nudge, it seems to have struck policy primetime – and as with many once-good ideas, it has mutated. I recently attended a meeting at one government department at which the conversation rarely strayed from the question of how the latest marketing tricks could be used to get citizens to behave as the nanny state preferred.

At a seminar for the UK’s government economic service on applying behavioural economics to public policy, I therefore expected to be the lone voice of caution – especially since fellow panellists included Dan Goldstein, a psychologist, and Pete Lunn, author of Basic Instincts, a popularisation of behavioural ideas. I was wrong: while everyone was impressed with the potential contribution of psychology and neuroscience to economics, they all seemed queasy about how quickly behavioural economics has appeared as a policy panacea.

Lunn began by displaying Poggendorff’s optical illusion, in which a diagonal line passes behind a vertical block, creating the impression of two separate but parallel lines. Thaler and Sunstein have a similar optical illusion at the beginning of chapter one of Nudge. Their point: the human brain has evolved to take short cuts in the way it processes information, short cuts that sometimes lead us astray. Hence, sometimes we could use a little help in nudging us towards the correct decision when we make mistakes.

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