Need an Interactive Map?

If you have a website and want to display statistics or improve navigation you should consider getting an interactive flash map. Options include a flash world map, a flash us map, and a flash canada map. These maps are fully customizable and easy to install. Free trials are available.

Recent Posts

Sponsored Links

Please login to Automatic Backlinks and activate this site.

website uptime

« | Main | »

Libertarian Paternalism

By Chris | January 25, 2009

I just finished Nudge, by Richard Thaler and Cass Sunstein. These University of Chicago professors advocate “libertarian paternalism” which recognizes that people often act irrationally and recommends that governments “nudge” people to make better choices. In their own words:

Libertarian paternalism is a weak, soft, and non-intrusive type of paternalism because choices are not blocked fenced off, or significantly burdened…Still the approach we recommend does count as paternalistic, because private and public choice architects are not merely trying to track or implement people’s choices. Rather, they are self-consciously attempting to move people in directions that will make their lives better. They nudge.

Thaler and Sunstein, reference psychological literature that says that people use two different systems of the thinking: The Automatic System and the Reflective System. The Automatic System is working when we flinch, respond with emotion, or shoot a three-pointer. The Reflective System is at work when we are making deliberate, and conscious decisions like solving an algebra problem. Often, our two systems are in conflict. Your Automatic System tells you to take an extra scoop of ice cream, even though your Reflective System decided last week that you needed to cut back. Over Christmas break, my Automatic System told me to keep playing ping-pong with my brother while my Reflective System told me that I needed to get to sleep before 2:00 am or I’d be a piece of meat the next day.

Often our mind loses the battle, and our Automatic System has it’s way. Nudge is a book about how government can structure choices to encourage us to make better decisions – the decisions our Reflective System wants us to make. I enjoyed the book, although I found the chapters on retirement savings and Medicare choices a bit dull. That might just be a generational thing though, Medicare probably won’t even be around by the time I’m eligible for benefits. Thaler and Sunstein make a lot of practical policy recommendations, many of which I would advocate. However, I take issue with their assumption that our true preferences are always those made by our Reflective System.

Part of what makes us different from animals is that we can think abstract thoughts and control our impulses. Clearly, our Automatic System gets us into trouble sometimes. We overeat, we procrastinate, we take stupid risks, we make choices today that we’ll regret tomorrow. However, our Reflective System also make systemic errors. It often does a very poor job of anticipating the costs and pleasures that will be very salient at a moment in time. When my Reflective System commits to running stairs early in the morning it underestimates both the joy of a little more sleep and the pain my calves will endure. A malfunctioning Reflective System is at fault when someone commits to an ambitious hike only to collapse from exhaustion before he can complete it. Poor reflective decisions cause us to overextend ourselves and stress us out. As an undergraduate, my Reflective System decided to take an overly ambitious course load that left me burnt out and exhausted half-way through the semester.

Moreover, we need our Automatic System to motivate and inspire us. I occasionally write letters to the editor of my collegiate newspaper. My Reflective Systems tells me this is something I would like to do, but my emotional response to truly bad editorials motivates to respond. And, my emotional response is what makes my letter worth reading. Try writing a touching letter, toast, or speech without accessing the emotional, personal, side of yourself. You will fail.

Libertarian paternalism has a lot of merit. We should structure choices to encourage people to save more, donate their organs, make smart investments, and consider the true costs of their actions. But, the Reflective System isn’t infallible and it isn’t always possible to tell what is in someone’s best interest. It is easy to say that I should have studied more for a test. I might even want to engage in a binding commitment to study more in the future. But, the Reflective System often ignores the opportunity cost of doing so: playing basketball, reading a book, cooking a meal, talking with a friend. Quality of life can’t be encompassed by stationary measures like our weight, savings etc. We shouldn’t ignore the utility from a fleeting pleasure, be it chocolate or sleep.

Topics: Behavioral Economics, Book Reviews, Economics, Political Science | 14 Comments »

14 Responses to “Libertarian Paternalism”

  1. Ron Says:
    January 30th, 2009 at 8:40 pm

    I see. Eating a pan of brownies at one sitting is automatic. A gradual consumption of carrots and green peppers over a week is reflective.

  2. Terry Says:
    January 18th, 2010 at 7:00 pm

    So Nudge advocates my loss of conscious choice?

  3. Matt Says:
    February 28th, 2010 at 6:11 pm

    No Terry,

    Nudge makes the point that we often do not make conscious choice at all.

    If you read into any depth into the study of choice you will quickly see that the way humans usually come to hold a belief based on “conscious” thought is to come to an end conclusion and work backward to fill in our reasoning after the fact. Often a person will make a choice that is fundamentally detrimental to their well being and will create a justification for it out of whole cloth.

    We are rarely aware of how we come to decisions and beliefs or why we hold them. We just do. Our brain is a “black box” that takes inputs from myriad sources and throws us output in the form of physical, emotional and thoughtful responses. Often our beliefs can change over a period of time and we are not even aware of this change and will even avow that no such change has occurred.

  4. Rob Bryan Says:
    March 18th, 2010 at 5:10 pm

    If you liked “Nudge”, you’ll love “Predictably Irrational: The Hidden Forces That Shape Our Decisions”
    by Dan Ariely.

  5. Using Incentives to Improve Education: TIME is paying kids to do better in school « Computing Education Blog Says:
    April 12th, 2010 at 7:06 pm

    […] didn’t have the Nudge or Freakonomics authors comment on the story — it’s directly libertarian […]

  6. A. Slave Says:
    March 12th, 2011 at 7:37 pm

    government is a garbage in garbage out system. if people are idiots then they will pick idiots. if they are smart, then they can make their own choices without government.

    it is incredibly naive to believe in the tooth fairy, big foot, good government, and santa claus.

  7. A. Slave Says:
    March 12th, 2011 at 7:38 pm

    look past your magic scrolls if you wish to grow intellectually and emotionally.

  8. Jack Says:
    October 31st, 2011 at 1:23 pm

    I think the notion of “libertarian paternalism” is quite oxymoronic. I mean there is no definitive differnce between liberty and coercion.

  9. John Says:
    January 5th, 2012 at 1:10 am

    Admin – could you use help with your website? Through our site you can find Outsourced Workers starting at $1/hour. They speak English, work flexible hours, and pride themselves on doing a quality job. There are Article Writers, Web Designers, Virtual Assistants, Email Response Handling, SEO Workers, & more. If interested we invite you to check out . Thanks 🙂

  10. nike free run 4 Says:
    September 20th, 2014 at 11:07 pm

    This site is known as a walk-via for the entire information you wanted about this and didn know who to ask.

  11. jordans for sale Says:
    October 22nd, 2014 at 7:59 am

    This next title doesn flare the same emotional impact, but Natural History of Love (Random House, 1994) is still a great choice. That over the moon feeling? It a one two of happy mood oxytocin and the amphetamine like phenylethylamine (known as PEA). In that wild beginning infatuation phase, sweet PEA is the reason you and your swee could stay up all night talking (or not talking). The researchers bland euphemisms alone are worth the ticket: couples having sex for Masters and Johnson are units. Kinsey gets his funding for behavior studies. Truthfully, there isn much else I can reveal in a family newspaper, but let just say here is the place to learn how porcupines manage lovemaking, why short women may experience more pleasure than tall ones, and how 17th century trials, to prove grounds for divorce, worked in France. (Picture, oh, the Supreme Court and every doctor from your HMO rushing into your bedroom at the crucial moment, carrying clipboards).Qu’il soit indulgent pour ces hommes politiques italiens, plus effars peut tre que chercheurs de finesses. La dmission de M. Rattazzi accompagne de l’vasion de Garibaldi a produit dans la direction des affaires une de ces confusions dont il serait injuste de faire porter la peine ceux qui en ont les premiers souffert la douloureuse influence.
    jordans for sale

  12. sprot blue 6s Says:
    October 22nd, 2014 at 8:00 am

    In contrast, the indifference of her critics in the state bureaucracy, who would forfeit her accomplishments in order to preserve their access to the public trough, proves beyond any doubt that neither they, nor Mr. Lubnau as their spokesman, have any interest in Wyoming children other than as a resource to empower and enrich those on the dole.
    sprot blue 6s

  13. black infrared 6s Says:
    October 22nd, 2014 at 8:00 am

    And this is why it is impossible to lead righties to reality. No matter how many times the facts are presented, they continue to cling to all the old talking points. Nobody cares how you handled email at your company. That’s NOT how the IRS handled it. It just isn’t, as has been documented a dozen or more times in this thread alone. Also, the IRS never had an email archiving contract. What they had was Sonasoft, and Sonasoft wasn’t used for archiving, as my quote from Sonasoft clearly states. All the IRS had for email was regular tape backups, and those tapes were scratched after six months.Kate Sassoon, a UC Berkeley student studying Theater and Biological Sciences, was among those arrested at the April rally. She and her two housemates were apprehended as they backed away when police started firing. Because they had linked arms, she said, they were unable to escape when motorcycle police pursued them, another tactic the protesters are calling abusive.
    black infrared 6s

  14. longchamp sac Says:
    June 5th, 2016 at 7:05 am

    you’re in point of fact a good webmaster. The web site loading pace is incredible. It sort of feels that you’re doing any unique trick. In addition, The contents are masterwork. you have done a excellent process on this topic!