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Suboptimal paternalism: Ability, benevolence, and self-selection in choosing for others

Author

Listed:
  • Felix Sebastian Doessing

    (CEBI, Department of Economics, University of Copenhagen)

  • David Dreyer Lassen

    (CEBI, Department of Economics, University of Copenhagen)

Abstract

Discussions about the legitimacy and welfare consequences of paternalistic interventions usually begin with the assumption that regulators are both benevolent and competent. We present experimental evidence that neither need be the case. In our experiment, individuals choose whether to restrict the choice of another participant and we see that regulation, on average, decreases choice efficiency. While more competent regulators are more likely to restrict choice sets in order to improve welfare for subjects when they use their regulatory privilige, selection into being an active regulator is unrelated to competence. The propensity for kind regulation is increasing in own competence, while the propensity for unkind regulation is both negatively related to own competence and positively related to the competence of the subject.

Suggested Citation

  • Felix Sebastian Doessing & David Dreyer Lassen, 2019. "Suboptimal paternalism: Ability, benevolence, and self-selection in choosing for others," CEBI working paper series 19-05, University of Copenhagen. Department of Economics. The Center for Economic Behavior and Inequality (CEBI).
  • Handle: RePEc:kud:kucebi:1905
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    File URL: https://www.econ.ku.dk/cebi/publikationer/working-papers/CEBI_WP_05-19.pdf
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    More about this item

    Keywords

    Paternalism; choosing for others; risk preferences; beneficence;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D60 - Microeconomics - - Welfare Economics - - - General
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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