George Will on Thaler & Sunstein’s “Nudge”

Nudge against the Fudge
– by George Will – Newsweek, June 30th, 2008
Updated: 1:47 PM ET Jun 21, 2008

“Barack Obama is a “choice architect” aiming to implement “libertarian paternalism.”He might not know that he is; he might embrace the practice without understanding the theory. It is adumbrated in the new book “Nudge” by two occasional and informal advisers to Obama, both of whom are former colleagues of his at the University of Chicago, Richard H. Thaler of the Graduate School of Business, and Cass R. Sunstein of the Law School.

Beginning this autumn, Sunstein, while retaining a connection with Chicago, will teach primarily at Harvard, an act of downward mobility that illustrates a central tenet of “Nudge,” that even intelligent and analytical people often make foolish choices.

Thaler and Sunstein correctly assume that people are busy, their lives are increasingly complicated and they have neither time nor inclination nor, often, the ability to think through even all important choices, from health care plans to retirement options. Therefore the framing of choices matters, particularly using the enormous power of the default option—the option that goes into effect if the chooser chooses not to make a choice.

Such is the power of inertia in human behavior, and the tendency of individuals to emulate others’ behavior, that there can be huge social consequences from the clever framing of the choices that nudgeable people—almost all of us—make. Choice architects understand that every choice is made in a context, and that contexts are not “neutral”—they inevitably encourage certain outcomes. Organizing the context can promote outcomes beneficial to choosers and, cumulatively, to society.

By a “nudge” Thaler and Sunstein mean a policy intervention into choice architecture that is easy and inexpensive to avoid and that alters people’s behavior in a predictable way without forbidding any options or significantly changing an individual’s economic incentives. “Putting the fruit at eye level counts as a nudge. Banning junk food does not.”

Thaler and Sunstein say the premise of libertarian policy is that people should be generally free to do what they please. Paternalistic policy “tries to influence choices in a way that will make choosers better off, as judged by themselves.” So “libertarian paternalism is a relatively weak, soft, and nonintrusive type of paternalism because choices are not blocked, fenced off, or significantly burdened.”

Thaler and Sunstein stress that if “incentives and nudges replace requirements and bans, government will be both smaller and more modest.” So nudges have the additional virtue of annoying those busybody, nanny-state liberals who, as the saying goes, do not care what people do as long as it is compulsory.

URL: http://www.newsweek.com/id/142638

Note: Good commentary, until you read the last sentence…Will just can’t do an article without throwing mud on “liberals”.

“Fundamentalists” or “Far-Right Wingnuts” would be a more appropriate label for “those busybodies…who are highly selective, vocal, and evangelical in their denunciations of what people sometimes do, and expend enormous effort making their personal choices compulsory for the public at large.”

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