We'd like to understand how you use our websites in order to improve them. Register your interest. This is a preview of subscription content, log in to check access. Rent this article via DeepDyve. For the sake of brevity, in this paper, I often refer to Thaler and Sunstein a , b as Nudge and to Rebonato as Taking Liberties.

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Blackwhite…this word has two mutually contradictory meanings. Applied to an opponent, it means the habit of impudently claiming that black is white, in contradiction of the plain facts. Applied to a Party member, it means a loyal willingness to say that black is white when Party discipline demands this. But it means also the ability to believe that black is white, and more, to know that black is white, and to forget that one has ever believed the contrary.

This demands a continuous alteration of the past, made possible by the system of thought which really embraces all the rest, and which is known in Newspeak as doublethink. You just know that this statement is likely to be followed by a racist comment of some sort, right? Well, what about the statement — issued in the title of a paper — that libertarian paternalism is not an oxymoron. What the coiners of the term have done is fuse together two words that are mutually contradictory.

In doing so they seek to obfuscate thinking and confuse people. I certainly think that state intervention is a necessity in a modern economy; I certainly think that people do not always act in their own self-interest; and I fully agree that the less encroachment upon personal freedom that the state has to engage in to achieve the best results the better.

But this does not excuse nonsense. We do not need to pervert language and reason to make this case. We elaborate a form of paternalism, libertarian in spirit, that should be acceptable to those who are firmly committed to freedom of choice on grounds of either autonomy or welfare. Indeed, we urge that libertarian paternalism provides a basis for both understanding and rethinking a number of areas of contemporary law, including those aspects that deal with worker welfare, consumer protection, and the family.

In the process of defending these claims, we intend to make some objections to widely held beliefs about both freedom of choice and paternalism. Our emphasis is on the fact that in many domains, people lack clear, stable, or well-ordered preferences. The substance of the above quote is actually true. Basically, the idea is to use the superior intelligence of the policymakers to trick people into doing what the policymaker thinks will best ensure the welfare of both the few and the many.

Advertisers have been doing this for years, as have many other in the public relations industry. For example, if your country was facing down a massive speculative attack on the currency it would be likely a good idea to counteract this with capital controls. These would limit the freedom of people to move money in and out of the country and this would likely be very unpopular. The inflation that would result without these controls, however, would provoke far more damage and would ultimately be much more unpopular.

The same case can be made with respect to almost all economic policies: from interest rates, to the taxation and spending system, to the minimum wage. Many of us may like this outcome but we should recognise that it is coercive on certain groups. Look, the libertarian paradigm is ridiculous. It rests on the idea that people exist as atoms in a world where each atom has no effects on other atoms except through completely free contractual arrangements. As a starting premise for a political philosophy this should be ridiculous to anyone who is not completely mentally insulated from the world around them.

What such fantasies then generate is the obverse nonsense that any form of paternalism by the state is basically as bad as a forced labour camp or something similar. This rubbish is propaganda, of course. It persuades people by framing issues in a certain way and appealing to primitive emotions. In short, anyone who buys such primitive arguments is the very rube that the soft paternalistic professions like advertisers, political strategists and public relations people target.

Just dump the libertarian stuff. Sensible people will recognise that we should try to maximise individual freedom unless this is not possible given a certain set of circumstances. The libertarian rubes — numbed as they are through the propaganda they are spoon-fed — will always paint these people as tyrants.

But no matter. We learn at the age of about three that we have to share the world with other people, and that we have to take those other people into account and they have to take us into account. You are right that the term is in fact an oxymoron. But I think you are wrong about libertarianism. I wrote an extended response. You are commenting using your WordPress.

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AR 385-64 PDF

Libertarian Paternalism Is an Oxymoron

Academic journal article Northwestern University Law Review. In Libertarian Paternalism Is Not an Oxymoron, Professors Sunstein and Thaler set out to show that state control over the structure of choice options can improve the welfare of citizens without reducing personal autonomy. Sunstein and Thaler's prototypical example of a libertarian paternalist policy is a k plan with the default option set to automatic enrollment to encourage participation but that permits employees to opt-out of default enrollment. As Sunstein and Thaler emphasize, because a default must be chosen, and because many individuals are likely to remain irrationally with the default option, it is better to set the default to the welfare-enhancing choice than to be blind to the power of the default. So long as individuals remain free to deviate from the default option, they argue, the libertarian should not be troubled by this weak form of paternalism. In this Essay, I discuss three defects present in the argument for libertarian paternalism: 1 a logical error and empirical oversight in the claim that paternalism is inevitable in situations where preferences exhibit irrational sensitivity to the choice frame; 2 a failure to justify the choice of welfare over liberty as the value guiding the paternalistic side of libertarian paternalism; and 3 a neglect of the redistributive effects of libertarian paternalism. Consideration of the third defect reveals that any form of libertarian paternalism, even the more truly libertarian paternalism proposed in Parts I and II below, may lead to a redistribution of resources from rational to irrational persons that cannot be reconciled with the libertarian prohibition on state-based takings for any purpose other than remedying involuntary exchanges.


A Critical Assessment of Libertarian Paternalism

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