Those who favor choice-promoting paternalism might acknowledge the plausibility of the phrase but object that we are really dealing here with a debater’s point, even a kind of pun. They might contend that their motivations are distinctly attractive and that so long as choices are being promoted, the standard concerns about paternalism are weakened or even eliminated. I have argued that those concerns are very much in play. But those who favor active choosing might argue that they are not, in fact, showing disrespect to choosers or insulting them in any way; on the contrary, they are honoring them.
They might add that their real concern is the welfare of choosers. Alert to the risks of mistakes on the part of choice architects, who may be ignorant or biased or neglectful of the importance of individual circumstances, they might claim to be the most faithful followers of Mill. They might make that claim even as they acknowledge that some people choose not to choose. To be sure, a decision to delegate the route to the airport to the cab driver might not be a mistake—but what about a decision involving one’s own medical care or financial situation?
There are some fair points here. No one doubts that those who do not want to choose might object to outsiders (intermeddlers?) who seek to influence or override their desire. But it is true that choice promoters do have distinctive motivations, associated with respect for choosers—which leads us to the question of justification.
Is Paternalism Justified? Welfare
It is important to acknowledge that even if a chooser freely chooses not to choose, that particular choice might turn out not to be in the chooser’s interest (as the chooser would define it). For that reason, choice-promoting or even choice-requiring paternalism might have a welfarist justification. Perhaps the chooser chooses not to choose only because he lacks important information, which would reveal that the default rule might be harmful or that the choice architect is ignorant or untrustworthy. Perhaps he suffers from some form of bounded rationality. A behavioral market failure (understood as a nonstandard market failure that comes from human error) might infect a choice not to choose, just as it might infect a choice about what to choose.
A nonchooser might, for example, be unduly affected by availability bias because of an overreaction to a recent situation in which his own choice went wrong. Or perhaps the chooser is myopic and is excessively influenced by the short-term costs of choosing, which might require some learning (and hence some investment), while underestimating the long-term benefits, which might be very large. A form of “present bias” might infect the decision not to choose. People might face a kind of intrapersonal collective action problem, in which such a decision by Jones, at Time 1, turns out to be welfare reducing for Jones at Times 2, 3, 4, and 5.
But for those who reject paternalism on welfarist grounds, these kinds of concerns are usually a justification for providing more and better information—not for blocking people’s choices, including their choices not to choose. Perhaps choosers should be nudged to choose. Choice-promoting paternalism, as a form of libertarian paternalism, might be preferred to choice-requiring paternalism.
On welfare grounds, the argument in favor of promoting or requiring choice-making is the same, in broad outline, as the argument for promoting or requiring any kind of behavior. Of course, welfarists might be wrong to object to paternalism; we can easily imagine contexts in which paternalism is amply justified on welfare grounds. But with respect to their objections, the question is whether the choice not to choose is, in general or in particular contexts, likely to go wrong, and in the abstract there is no reason to think that a particular choice would be especially error-prone. In light of people’s tendency to fall prey to overconfidence, the choice not to choose might even be peculiarly likely to be right, which would create serious problems for choice-requiring paternalism. At most, concerns about individual error would seem to support choice-promoting paternalism, not a more aggressive variety.
Consider in this regard evidence that people spend too much time trying to make precisely the right choice, in a way that leads to significant welfare losses. In many situations, people underestimate the temporal costs of choosing and exaggerate the benefits, producing “systematic mistakes in predicting the effect of having more, versus less, choice freedom on task performance and task-induced affect.”12 If people make such systematic mistakes, it stands to reason that they might well choose to choose in circumstances in which they ought not to do so on welfare grounds. And if choosing has intrinsic value, then people will choose in circumstances in which they would do better, at least in material terms, to make some kind of delegation.
My aim is not to endorse the welfarist rejection of paternalism; it is only to say that the underlying arguments apply to all forms of paternalism, including those that would interfere with the decision not to choose. To be sure, some welfarists are willing to interfere with people’s choices; they may well be libertarian or nonlibertarian paternalists. The simplest points are that the standard welfarist arguments on behalf of freedom of choice apply to those who (freely) choose not to choose and that those who want to interfere with such choices might well be paternalists. Whether their paternalism is justified, on welfare grounds, depends on the context.
Is Paternalism Justified? Autonomy
We have seen that from the standpoint of autonomy, interference with the choice not to choose is presumptively objectionable. When cab drivers ask passengers to choose, they might be intruding on their passengers’ autonomy; when a passenger says, “you decide,” he is exercising his autonomy. It is respectful of choosers, and a recognition of their dignity, to allow them to devote their attention to those topics to which they want to devote their attention.
As we have seen, the most obvious exceptions are those in which the choice counts as some kind of alienation of freedom. But perhaps there are other exceptions, raising the question whether choice-promoting or choice-requiring paternalism might often be justified on autonomy grounds. An employer might believe that employees should choose their own health insurance plan so that their own capacity for agency is exercised and increased—not only with respect to health insurance plans but with respect to a wide range of choices that call for statistical literacy. For medical matters generally, it might be best to try to boost people’s capacities—perhaps by providing simple information, perhaps by teaching statistical competence—with the thought that a successful effort on that count will increase people’s autonomy in multiple domains. Similar considerations might support active choosing in the context of retirement plans. The examples could easily be multiplied.
These points show that if the goal is to respect or promote autonomy, it is not always clear whether we should embrace or reject choice-promoting paternalism. On the one hand, people do exercise their autonomy by deciding when and whether to choose. In fact, that is a fundamental way that autonomy is exercised. That is a strong reason to reject choice-preserving paternalism. On the other hand, choice making is like a muscle, and it can be strengthened through use. For choice architects, the most general suggestion is that on autonomy grounds, people should be able to choose or not choose as they see fit, but in some circumstances the promotion of autonomy can itself justify influencing or overriding the choice not to choose—with the strength of the argument depending on the value, for autonomy, of promoting choice making in a particular context.
Notes
1. See Daniel Kahneman, Thinking, Fast and Slow 20–21 (2011). The idea of two “systems” is controversial in some circles, and nothing here depends on accepting that idea.
2. See Sarah Conly, Against Autonomy (2012); Ryan Bubb & Richard Pildes, How Behavioral Economics Trims Its Sails and Why, 127 Harv. L. Rev. 1593, 1659 (2014).
3. See Sendhil Mullainathan & Eldar Shafir, Scarcity: Why Having Too Little Means So Much 39–66 (2013).
4. For a demonstration, see Björn Bartling & Urs Fischbacher, Shifting the Blame: On Delegation and Responsibility, 79 Rev. Econ. Stud. 67 (2012). On people’s prefere
nce for flipping a coin as a way of avoiding responsibility, see Nadja Dwenger, Dorothea Kübler & Georg Weizsäcker, Flipping a Coin: Theory and Evidence, unpublished manuscript (2013), https://www.wzb.eu/sites/default/files/%2Bwzb/mp/vam/flipping_2014-01-21.pdf. Consider this suggestion: The cognitive or emotional cost of deciding may outweigh the benefits that arise from making the optimal choice. For example, the decision-maker may prefer not to make a choice without having sufficient time and energy to think it through. Or, she may not feel entitled to make it. Or, she may anticipate a possible disappointment about her choice that can arise after a subsequent resolution of uncertainty. Waiving some or all of the decision right may seem desirable in such circumstances even though it typically increases the chance of a suboptimal outcome. (id. at 1)
5. See Pandora Can Predict How You Vote Based on Your Favorite Stations, Huffington Post, February 18, 2014, https://www.huffingtonpost.com/2014/02/18/pandora-democrat-republican-_n_4809401.html.
6. See, e.g., Paternalism: Theory and Practice (Christian Coons & Michael Weber eds., 2013); Gerald Dworkin, The Theory and Practice of Autonomy (1988).
7. See F. A. Hayek, The Market and Other Orders 384–386 (Bruce Caldwell ed., 2014).
8. John Stuart Mill, On Liberty, in On Liberty 5, 76 (Stefan Collini ed., 1859/1989) (1859).
9. Id at 76.
10. See George Loewenstein et al., Warning: You Are About to Be Nudged, 1 Behav. Sci. & Pol’y 35, 37, 40 (2015).
11. See Hendrik Bruns et al., Can Nudges Be Transparent and Yet Effective? 16–17 (WiSo-HH Working Paper Series, Working Paper No. 33, 2016), https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2816227; Mary Steffel, Elanor F. Williams, & Ruth Pogacar, Ethically Deployed Defaults: Transparency and Consumer Protection through Disclosure and Preference Articulation, 53 J. Marketing Res. 865, 872 (2016).
12. Simona Botti & Christopher Hsee, Dazed and Confused by Choice, 112 Org. Behav. & Hum. Decision Processes 161 (2010).
6
Welfare
Some nudges are designed to reduce externalities: consider fuel economy labels that draw attention to environmental consequences or default rules that automatically enroll people in green energy. But many nudges are designed to increase the likelihood that people’s choices will improve their own welfare. The central goal of such nudges is to “make choosers better off, as judged by themselves.”1 Social planners—or choice architects—might well have their own ideas about what would make choosers better off—but in our view, the lodestar is people’s own judgments. To be a bit more specific, the lodestar is welfare, and people’s own judgments are a good (if imperfect) way to test whether nudges are increasing their welfare.
The last sentence raises many questions, and it is certainly reasonable to wonder about potential ambiguities in the “as judged by themselves” (hereinafter AJBT) criterion. Should the focus be on choosers’ judgments before the nudge or instead after? What if the nudge alters people’s preferences so that they like the outcome produced by the nudge when they would not have sought that outcome in advance? What if preferences are constructed by the relevant choice architecture? What if people’s ex ante judgments are wrong, in the sense that a nudge would improve their welfare even though they do not think that it would? Do we want to ask about choosers’ actual, potentially uninformed or behaviorally biased judgments, or are we entitled to ask what choosers would think if they had all relevant information and were unaffected by relevant biases?
My goal here is to explore the meaning of the AJBT criterion and to sort out some of the ambiguities. As we shall see, three categories of cases should be distinguished: (1) those in which choosers have clear antecedent preferences, and nudges help them to satisfy those preferences; (2) those in which choosers face a self-control problem, and nudges help them to overcome that problem; and (3) those in which choosers would be content with the outcomes produced by two or more nudges or in which ex post preferences are endogenous to or constructed by nudges, so that the AJBT criterion leaves choice architects with several options without specifying which one to choose. Cases that fall in category 1 plainly satisfy the AJBT criterion, and there are many such cases. From the standpoint of the AJBT criterion, cases that fall in category 2 are also unobjectionable—indeed, they can be seen as a subset of category 1—and they are plentiful. Cases that fall in category 3 create special challenges, which may lead us to make direct inquiries into people’s welfare or to explore what informed, active choosers typically select.
In an instructive set of comments, critical of the enterprise of nudging, the economist Robert Sugden presses a simple question:2 “Do people really want to be nudged towards healthy lifestyles?” That is an empirical question, and we have a great deal of evidence about it. The answer is “yes,” at least in the sense that in numerous nations—including the United States, the United Kingdom, Germany, France, Ireland, Italy, and Australia—strong majorities endorse nudges toward healthy lifestyles.3 One might object that general attitudes toward nudges do not specifically answer Sudgen’s question and that it is best not to ask people generally (1) whether they approve of nudges, but instead to ask more specifically (2) whether they themselves would like to be nudged. But general approval of health-related nudges strongly suggests that the answer to (2) is probably yes as well, and, in any case, the existing evidence suggests that the answer to (2), asked specifically, is also yes.4 To be sure, more remains to be learned on these issues.
These findings cannot speak to conceptual and normative questions. What does it even mean to say that people want to make the choices toward which they are being nudged? What is the relationship between people’s preferences and imaginable nudges? In light of behavioral findings, how confidently can we speak of people’s “preferences”? If people want to be nudged, why are they not already doing what they would be nudged to do? Those are important questions (and they do have empirical features).
It is not possible to understand the operation of the AJBT criterion without reference to examples. In countless cases, we can fairly say that given people’s antecedent preferences, a nudge will make choosers better off AJBT. For example:
1. Luke has heart disease and needs to take various medications. He wants to do so, but he is sometimes forgetful. His doctor sends him periodic text messages. As a result, he takes the medications. He is very glad to receive those messages.
2. Meredith has a mild weight problem. She is aware of that fact, and though she does not suffer serious issues of self-control and does not want to stop eating the foods that she enjoys, she does seek to lose weight. Because of a new law, many restaurants in her city have clear calorie labels, informing her of the caloric content of various options. As a result, she sometimes chooses low-calorie offerings—which she would not do if she was not informed. She is losing weight. She is very glad to see those calorie labels.
3. Edna is a professor at a large university, which has long offered its employees the option to sign up for a retirement plan. Edna believes that signing up would be a terrific idea, but she has not gotten around to it. She is somewhat embarrassed about that. Last year, the university switched to an automatic enrollment plan, by which employees are defaulted into the university’s plan. They are allowed to opt out, but Edna does not. She is very glad that she has been automatically enrolled in the plan.
There is nothing unfamiliar about these cases. On the contrary, they capture a great deal of the real-world terrain of nudging, both by governments and by the private sector. Choosers have a goal, or an assortment of goals, and the relevant choice architecture can make it easier or harder for them to achieve it or them. Insofar as we understand the AJBT criterion by reference to people’s antecedent preferences, that criterion is met. Note that it would be easy to design variations on these cases in which nudges failed that criterion because they would make people worse off by their own lights.
We could complicate the cases of Luke, Meredith, and Edna by assuming that they have clear a
ntecedent preferences, that the nudge is inconsistent with those preferences, and that as a result of the nudge their preferences are changed. For example, Jonathan likes talking on his cell phone while driving. He talks to friends on his commute to work, and he does business as well. As a result of a set of vivid warnings, he has stopped. He is glad. He cannot imagine why anyone would talk on a cell phone while driving. In his view, that is too dangerous.
After the nudge, Luke, Meredith, Edna, and Jonathan believe themselves to be better off. Cases of this kind raise the question whether the AJBT criterion requires reference to ex ante or ex post preferences. That is a good question, which might be answered by making direct inquiries into people’s welfare; I will turn to that question below. My main point is that as originally given, the cases of Luke, Elizabeth, and Edna are straightforward. Such cases are common.
Some cases can be seen as different because they raise questions about self-control:
1. Ted smokes cigarettes. He wishes that he had not started, but he has been unable to quit. His government has recently imposed a new requirement, which is that cigarette packages must be accompanied with graphic images showing people with serious health problems, including lung cancer. Ted is deeply affected by those images; he cannot bear to see them. He quits, and he is glad.
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