Author:

Abstract

Empirical studies have shown that people are less than rational decision makers. Instead of assessing all available options and choosing that which maximises welfare, people are heavily influenced by the way a choice is designed, i.e. presented to them. That is why Thaler and Sunstein, authors of Nudge, argue that choice designers have a special responsibility. They should try to find out which options maximise welfare, and then design choices such that people will be inclined to choose their welfare maximising option. Choice designers should thus act as libertarian paternalists: as paternalists, they gently nudge people towards better decisions; as libertarians, they respect freedom of choice. I criticise Thaler and Sunstein’s approach as based on distorted views of both libertarianism and paternalism. Contrary to what the authors hold, a libertarian is not a person who advocates free choice as welfare-promoting, and an opponent of paternalism is not someone who denies that third parties could in principle improve other people’s decisions. What is usually denied is that such an idealised notion of paternalism is feasible or desirable in practice. I hold that the improper use of the two terms does not invalidate all of the authors’ arguments. It is nevertheless a source of frequent irritation and confusion.