Choice Architecture and Paternalism
I’m trying to get clear on what Sunstein and Thaler mean, and it’s not easy, since they basically make up their own private language, and then act puzzled by the idea that some people might be a little confused by what they have in mind.
So a “choice architect” is basically anyone that organizes “the context in which people make choices.” This is so immensely broad as to be almost useless.
If you design the form that new employees fill out to enroll in the company health plan, you are a choice architect. If you are a parent, describing possible educational options to your son or daughter, you are a choice architect. If you are a salesperson, you are a choice architect.
And if you invite people to a party where alcohol is available, the music is bumpin’, and the lights are low, you are choice arcitecht. Everyone is a choice architect some of the time.
So what’s the relationship between ‘choice architect’ and ‘paternalist’? Is everyone a paternalist, too? It looks like it. According to S&T:
The paternalistic aspect [of libertarian paternalism] lies in the claim that it is legitimate for choice architects [i.e., everybody] to try to influence people’s behavior ino order to make their lives longer, healthier, and better. … In our understanding, a policy is “paternalistic” if it tries to influence choices in a way that will make choosers better off, as judged by themselves. [Emphasis theirs.]
The designers of the user-friendly iPod, whom S&T tag as “choice architects,” presumably leave iPod users better off by their own lights, and therefore count as nudging libertarian paternalists. And who’s against usable interface design?! And if the host of a party turns down the lights, that’s paternalistic choice architecture if it influences some of the guests’ behavior in a way that makes them better off, as judged by themselves. This all very weird.
First, this has nothing to do with ‘paternalism’ as English speakers use the word. On their definition, giving someone accurate and easy-to-follow directions to the nearest gas station is paternalistic. But it isn’t, so they are using words wrong. To put it another way, S&T imply that it is not possible to provide helpful guidance to another person without being paternalistic. But it is possible. So they’re speaking literal nonsense. QED.
Another tack… They express a sufficient condition for paternalism here. They don’t say a policy or action isn’t paternalistic if it doesn’t makes people better off by their own lights, but the suggestion of an “only if” hangs out there, and I think they want it hanging out there. Paternalism is nice! Paternalism cares about getting people’s buy-in. Except… it doesn’t. The attempt to make you better off by my lights, not yours, is what a competent English speaker has in mind if she accuses me of being “paternalistic” — and that’s whether or not she assumes paternalism necessarily involves coercion, an assumption S&T call a “misconception”, despite the fact that most dictionaries and the history of Western thought generally insists on conceiving it that way. If you open up the little box that is the concept ordinarily expressed by the English word ‘paternalism’, you will find indifference to the endorsement or buy-in of those “influenced” by paternalistic efforts. But if you learned the meaning of the word from S&T, you’d think that was wrong!
The tone in Nudge is chummy and agreeable and sunnily ameliorist. Which makes you feel a bit like an axe-grinding killjoy bent on hair-splitting “semantics” when you insist on pointing out that they spend the entire book more or less inverting the normal meaning of certain politically-loaded words. But I really do insist on pointing it out, because these brilliant guys are native English speakers and they’ve got to know that the meanings of words matters. So you’re left wondering why they are so determined to play dumb about their own language.
April 20th, 2008 17:22
I wonder if even on their terms, libertarian paternalism can be shown to be not so rosy
Everyone is a choice architect, mostly for themselves. Each of us is always making plans, eliminating options, etc so our future selves will do the “right” thing. This is an internal libertarian paternalism… nudging the self.
What if a rise in external libertarian paternalism makes the average choice architect (external and internal) worse at his job? For example, if people don’t have to think about various 401k options because the default has been architected to be the “right” one, then people don’t have to teach themselves about finance, they just go with the flow. Of course, they’re probably better off with regard to that particular 401k plan (i.e. less likely to make a mistake), but because they don’t have to know as much about finance, they’re worse off in the rest of their financial decisions (err, that is: internal choice architectures relating to finance).
April 20th, 2008 17:36
push,
Excellent. I read a piece the other day that said that “financial literacy” is dangerous because people might decide they know something but then make a mistake. So they should NOT learn about markets and leave it to the experts to make investment decisions for them. It occurred to me this was basically the classical priestly Catholic argument against people being able to read the Bible in their own languages.
April 20th, 2008 17:43
Those underwhelmed by Sunstein & Thaler should also check out Mario Rizzo’s latest anti-Nudged paper on SSRN, regarding the problem of soft paternalism and “slippery slopes.”
April 20th, 2008 21:11
I agree that “paternalism” isn’t the right word, but I don’t necessarily agree that paying greater attention to the design of forms/situations/experiences will lead to mental lethargy. Isn’t this just an example of specialization? Paying less attention to a 401k form will allow the worker in pushmedia1’s example to focus more on whatever the thing they do that adds the greatest value to their employer and/or society. Who cares if they knows the ins and outs of their 401k…leave that to the experts!
April 21st, 2008 16:18
Mr. Monnier, I think you’re right. My point, though, was there’s a trade-off between the quantity of external choice architectures and the quality of internal choice architectures. That is: the optimal level of libertarian paternalism isn’t zero, but its probably not as high as S&T are making it out to be.
April 22nd, 2008 17:39
An excellent analysis.
April 23rd, 2008 17:44
For someone so intent on accusing Thaler and Sunstein of not knowing how to use words, you completely elide an mention of the modifying adjective “libertarian” in Thaler and Sunstein’s lexicon. The whole point is that “libertarian paternalism,” as defined by them, is qualitatively different from paternalism’s already extant “little box of meaning.” And their point is that as choice architects, we cannot help constructing a choice that favors a particular outcome. Just because we are not conscious of it, does not mean we are not doing it. To that extent, we are unwitting practitioners of “libertarian paternalism,” as were all the MP3 designers who made interfaces that weren’t as usable as the iPod’s; they just didn’t know that they weren’t that usable. And just because the term “choice architect” is broad, does not mean it isn’t helpful. Yes, we are all at one time or another choice architects (as much for ourselves as for others), but we are also all consumers at one point or another, and that doesn’t stop us from thinking about consumers and producers differently (and helpfully). Realizing that how we structure the choice may help us achieve what we wan’t (we don’t have to be libertarian paternalists here…we could be libertarian rent-seekers, in a perverse combination of T&S’s vocabulary). You’re not grinding a particularly useful axe here…and it is partly the behavioral economists’ fault for appropriating the term “paternalist” and couching it in their modifiers, but just beware the knee-jerk opposition.
Also, pushmedia1, I agree with you that there are dynamic implications to making decisions for people, but it’s already being done and right know what people think the “right” decision is really isn’t (that is, the authors are pushing more for a change in the quality, not the quantity, of external choice architectures, since these architectures, whether we like them or not, are already there). Furthermore, recent psychological research points toward limited quantities of willpower and cognitive ability in a given day, suggesting that if people are currently subject to this willpower constraint, then an increase in the quantity of external choice architectures may actually increase the quality of internal choice architectures.
April 23rd, 2008 21:34
Ok, so they’re not only abusing the term “paternalism.”
They’re abusing “libertarian,” too.
They combine them and apply the combination to something that’s neither.
April 23rd, 2008 21:43
What S&T mean by “libertarian paternalism” is, in normal English, “choice-preserving helpfulness”. Normally we don’t think of choice-eliminating helpfulness as a kind of helpfulness, so really they just mean helpfulness, taking into account new results in psychology. It’s pretty vacuous.
April 24th, 2008 00:25
It’s merely vacuous if limited to the fairly benign examples like changing defaults with low opt-in/opt-out costs.
But, it seems naive to think that the “choice architects” will limit their activity to things that will benefit all of the targets of their actions.
Their incentives are aligned with the wishes of people who will add to their power, not with people they affect. They will certainly end up “helping” in ways that are not actually helpful, low-cost, or even choice-preserving.
It requires ignoring mountains of evidence to think that this dynamic will change if we add adjectives like “soft” or “libertarian” to the activity.
April 24th, 2008 11:51
“Normally we don’t think of choice-eliminating helpfulness as a kind of helpfulness.”
Who is “we” in this sentence? If it is libertarians, then obviously. If it is anyone in politics, then I heartily disagree: motorcycle helmet laws, seatbelt laws, social security, etc. are all policies the creators/supporters of which deem helpful, and yet are choice-eliminating. And it is to exactly those in politics that T&S are appealing - those who would try to use paternalism in the well-worn sense that you’ve outlined above. And hey, combining an adjective with a noun to create something that means neither strictly the adjective nor the noun is called language (see “ant lion” or “compassionate conservative”).
April 25th, 2008 16:03
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