Spurred on by the interest Niketh showed in the subject, I hereby present what is mainly a collection of links that anyone who cares enough to google “Libertarian Paternalism” can find. I’m just putting it here so that you can see it anyway…something that just happens to be the essence of libertarian paternalism 🙂 . Not that I’m taking a definite side yet, there seem to be quite a few difficulties, as Becker and Posner point out below.
First, the paper that started it all…it’s about 45 pages so I doubt anyone will read all of it, although its very well written and eminently readable:
43. Cass R. Sunstein and Richard H. Thaler, Libertarian Paternalism Is Not an Oxymoron (May 2003). For all those who don’t want to wade through the other papers, PDF Here.
A Clarification post by the authors of the same pioneering document at the University of Chicago Law School Faculty’s blog, here. This one deals with some of the issues raised by Becker and Posner below, although probably not fully.
What libertarian paternalists add is that the opposition between “individual choice” and “government” is confusing and unhelpful when government is inevitably establishing default rules that govern outcomes if choices haven’t been specifically made — and that influence people’s choices in any case. A key point, then, is that private and public institutions can’t possibly avoid a form of paternalism, so long as they establish default rules and starting points.
A critique of the whole concept based on the struggle between a “stronger” and “weaker” self at the Becker-Posner blog, here. By the way, for anyone even marginally interested in economics this is a must-read, along with Marginal Revolution, Freakonomics and Greg Mankiw’s blog. Too bad most of it deals with US-specific stuff.
A libertarian paternalist is happy to accept information arguments for government regulation of behavior, but typically stresses other considerations. One of the best statements of this view argues that “Equipped with an understanding of behavioral findings of bounded rationality and bounded self-control, libertarian paternalists should attempt to steer people’s choices in welfare-promoting directions without eliminating freedom of choice. It is also possible to show how a libertarian paternalist might select among the possible options and to assess how much choice to offer.” Cass Sunstein and Richard Thaler, “Libertarian Paternalism is Not an Oxymoron”, University of Chicago Law Review, 70(4), Fall, 2003; for a strong response, see Daniel Klein, “Status Quo Bias”, Econ Journal Watch, August 2004.
If not literally an oxymoron, the term “libertarian paternalism” is, I believe, awfully close to it.
And another critique at a blog that seems very decent, although not as oft-cited as the ones above:
The thing is, we often rightly resent their attempts to manipulate us, but at least we are more or less in control of our exposure to such people. But when choice architecture is implemented politically, we cannot opt out of these attempts at manipulation, attempts which may or may not be benign. That’s a big problem because political choice architecture may do a great deal to shape us, even if, in its “libertarian paternalist” incarnation, it makes a show of leaving the ultimate choice open to individuals. For example, I would object if President John McCain implemented a policy of opt-out national service because such a policy would communicate all-too-clearly that individuals need some kind of special justification or rationale not to serve the state. The default rule itself contains meaningful content. If allowed to stand, such a policy could shape norms and individual preferences in a direction antagonistic to the value of autonomy. Soon enough we might find ourselves asking, “Why should you be able to opt out at all?” The paternalistic nudge may “leave the choice open” but accepting the legitimacy of certain nudges may imperil liberty.
Yes, I do know practically no one will read any of this, even if they bother clicking, but hey, it took 15 minutes…