IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Autonomy-enhancing Paternalism

  • Martin Binder
  • Leonhard K. Lades

Behavioral economics has shown that individuals sometimes make decisions that are not in their best interests. This insight has prompted calls for behaviorally informed policy interventions popularized under the notion of "libertarian paternalism." This type of "soft" paternalism aims at helping individuals without reducing their freedom of choice. We highlight three problems of libertarian paternalism: the difficulty of detecting what is in the best interest of an individual, the focus on freedom of choice at the expense of a focus on autonomy, and the neglect of the dynamic effects of libertarian-paternalistic policy interventions. We present a form of soft pa-ternalism called "autonomy-enhancing paternalism" that seeks to constructively remedy these problems. Autonomy-enhancing paternalism suggests using insights from subjective well-being research in order to determine what makes individuals better off. It imposes an additional con-straint on the set of permissible interventions highlighting the importance of autonomy in the sense of the capability to make critically reflected (i.e., autonomous) decisions. Finally, it acknowledges that behavioral interventions can change the strength of individual decision-making anomalies over time as well as influence individual preference learning. We illustrate the differences between libertarian paternalism and autonomy-enhancing paternalism in a sim-ple formal model in the context of optimal sin nudges.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.levyinstitute.org/pubs/wp_800.pdf
Download Restriction: no

Paper provided by Levy Economics Institute in its series Economics Working Paper Archive with number wp_800.

as
in new window

Length:
Date of creation: May 2014
Date of revision:
Handle: RePEc:lev:wrkpap:wp_800
Contact details of provider: Web page: http://www.levyinstitute.org

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Christian Schubert, 2012. "Pursuing Happiness," Kyklos, Wiley Blackwell, vol. 65(2), pages 245-261, 05.
  2. Edward L. Glaeser, 2005. "Paternalism and Psychology," NBER Working Papers 11789, National Bureau of Economic Research, Inc.
  3. John Conlisk, 1996. "Why Bounded Rationality?," Journal of Economic Literature, American Economic Association, vol. 34(2), pages 669-700, June.
  4. Beshears, John & Choi, James J. & Laibson, David & Madrian, Brigitte C., 2008. "How are preferences revealed?," Journal of Public Economics, Elsevier, vol. 92(8-9), pages 1787-1794, August.
  5. Boyce, Christopher J. & Wood, Alex M., 2011. "Personality and the marginal utility of income: Personality interacts with increases in household income to determine life satisfaction," Journal of Economic Behavior & Organization, Elsevier, vol. 78(1), pages 183-191.
  6. Schubert, Christian & Cordes, Christian, 2013. "Role models that make you unhappy: light paternalism, social learning, and welfare," Journal of Institutional Economics, Cambridge University Press, vol. 9(02), pages 131-159, June.
  7. Richard H. Thaler & Cass R. Sunstein, 2003. "Libertarian Paternalism," American Economic Review, American Economic Association, vol. 93(2), pages 175-179, May.
  8. Paul Anand & Alastair Gray, 2009. "Obesity as Market Failure: Could a 'Deliberative Economy' Overcome the Problems of Paternalism?," Kyklos, Wiley Blackwell, vol. 62(2), pages 182-190, 04.
  9. Cass R. Sunstein & Richard H. Thaler, 2003. "Libertarian paternalism is not an oxymoron," Conference Series ; [Proceedings], Federal Reserve Bank of Boston, vol. 48(Jun).
  10. Ted O'Donoghue & Matthew Rabin, 2003. "Studying Optimal Paternalism, Illustrated by a Model of Sin Taxes," American Economic Review, American Economic Association, vol. 93(2), pages 186-191, May.
  11. Boyce, Christopher J. & Wood, Alex M., 2011. "Personality and the marginal utility of income: Personality interacts with increases in household income to determine life satisfaction," Journal of Economic Behavior & Organization, Elsevier, vol. 78(1-2), pages 183-191, April.
  12. Bruno Frey & Alois Stutzer, 2010. "Happiness and public choice," Public Choice, Springer, vol. 144(3), pages 557-573, September.
  13. Witt, Ulrich & Binder, Martin, 2013. "Disentangling motivational and experiential aspects of “utility” – A neuroeconomics perspective," Journal of Economic Psychology, Elsevier, vol. 36(C), pages 27-40.
  14. Krueger, Alan B. & Schkade, David A., 2007. "The Reliability of Subjective Well-Being Measures," IZA Discussion Papers 2724, Institute for the Study of Labor (IZA).
  15. Christine Jolls & Cass R. Sunstein, 2006. "Debiasing through Law," The Journal of Legal Studies, University of Chicago Press, vol. 35(1), pages 199-242, 01.
  16. Leonhard K. Lades, 2012. "Impulsive Consumption and Reflexive Thought: Nudging Ethical Consumer Behavior," Papers on Economics and Evolution 2012-03, Philipps University Marburg, Department of Geography.
  17. Binder, Martin & Coad, Alex, 2011. "From Average Joe's happiness to Miserable Jane and Cheerful John: using quantile regressions to analyze the full subjective well-being distribution," Journal of Economic Behavior & Organization, Elsevier, vol. 79(3), pages 275-290, August.
  18. Brigitte C. Madrian & Dennis F. Shea, 2000. "The Power of Suggestion: Inertia in 401(k) Participation and Savings Behavior," NBER Working Papers 7682, National Bureau of Economic Research, Inc.
  19. Mozaffar Qizilbash, 2011. "Sugden’s critique of Sen’s capability approach and the dangers of libertarian paternalism," International Review of Economics, Springer, vol. 58(1), pages 21-42, March.
  20. Berg, Nathan & Biele, Guido & Gigerenzer, Gerd, 2010. "Does Consistency Predict Accuracy of Beliefs?: Economists Surveyed About PSA," MPRA Paper 24976, University Library of Munich, Germany.
  21. Bruce Ian Carlin & Simon Gervais & Gustavo Manso, 2013. "Libertarian Paternalism, Information Production, and Financial Decision Making," Review of Financial Studies, Society for Financial Studies, vol. 26(9), pages 2204-2228.
  22. Binder, Martin & Coad, Alex, 2010. "An examination of the dynamics of well-being and life events using vector autoregressions," Journal of Economic Behavior & Organization, Elsevier, vol. 76(2), pages 352-371, November.
  23. Leonardo Becchetti & Alessandra Pelloni & Fiammetta Rossetti, 2008. "Relational Goods, Sociability, and happiness," CEIS Research Paper 117, Tor Vergata University, CEIS, revised 14 Jul 2008.
  24. Lades, Leonhard K., 2012. "Towards an incentive salience model of intertemporal choice," Journal of Economic Psychology, Elsevier, vol. 33(4), pages 833-841.
  25. Gregory Besharov, 2004. "Second-Best Considerations in Correcting Cognitive Biases," Southern Economic Journal, Southern Economic Association, vol. 71(1), pages 12-20, July.
  26. Sendhil Mullainathan & Joshua Schwartzstein & William J. Congdon, 2012. "A Reduced-Form Approach to Behavioral Public Finance," Annual Review of Economics, Annual Reviews, vol. 4(1), pages 511-540, 07.
  27. Welsch, Heinz, 2002. "Preferences over Prosperity and Pollution: Environmental Valuation Based on Happiness Surveys," Kyklos, Wiley Blackwell, vol. 55(4), pages 473-94.
  28. Witt, Ulrich, 1991. "Economics, sociobiology and behavioral psychology on preferences," Journal of Economic Psychology, Elsevier, vol. 12(4), pages 557-573, December.
  29. Rabin, Matthew, 1997. "Psychology and Economics," Department of Economics, Working Paper Series qt8jd5z5j2, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
  30. Cass R. Sunstein & Lucia A. Reisch, 2013. "Green by Default," Kyklos, Wiley Blackwell, vol. 66(3), pages 398-402, 08.
  31. Dolan, Paul & Peasgood, Tessa & White, Mathew, 2008. "Do we really know what makes us happy A review of the economic literature on the factors associated with subjective well-being," Journal of Economic Psychology, Elsevier, vol. 29(1), pages 94-122, February.
  32. Besharov, Gregory, 2001. "Second-Best Considerations in Correcting Cognitive Biases," Working Papers 01-08, Duke University, Department of Economics.
  33. Ulrich Witt, 2001. "special issue: Learning to consume - A theory of wants and the growth of demand," Journal of Evolutionary Economics, Springer, vol. 11(1), pages 23-36.
  34. Martin Binder, 2014. "Should evolutionary economists embrace libertarian paternalism?," Journal of Evolutionary Economics, Springer, vol. 24(3), pages 515-539, July.
  35. Ted O'Donoghue & Matthew Rabin, 2005. "Optimal Sin Taxes," Levine's Bibliography 784828000000000346, UCLA Department of Economics.
  36. Mozaffar Qizilbash, 2009. "Well-Being, Preference Formation and the Danger of Paternalism," Papers on Economics and Evolution 2009-18, Philipps University Marburg, Department of Geography.
  37. Berg, Nathan & Eckel, Catherine & Johnson, Cathleen, 2010. "Inconsistency Pays?: Time-inconsistent subjects and EU violators earn more," MPRA Paper 26589, University Library of Munich, Germany.
  38. Kahneman, Daniel & Wakker, Peter P & Sarin, Rakesh, 1997. "Back to Bentham? Explorations of Experienced Utility," The Quarterly Journal of Economics, MIT Press, vol. 112(2), pages 375-405, May.
  39. Koszegi, Botond & Rabin, Matthew, 2008. "Choices, situations, and happiness," Journal of Public Economics, Elsevier, vol. 92(8-9), pages 1821-1832, August.
  40. Edward L. Glaeser, 2005. "Paternalism and Psychology," Harvard Institute of Economic Research Working Papers 2097, Harvard - Institute of Economic Research.
  41. Laibson, David I., 1997. "Golden Eggs and Hyperbolic Discounting," Scholarly Articles 4481499, Harvard University Department of Economics.
  42. Mozaffar Qizilbash, 2012. "Informed desire and the ambitions of libertarian paternalism," Social Choice and Welfare, Springer, vol. 38(4), pages 647-658, April.
  43. Gharad Bryan & Dean Karlan & Scott Nelson, 2010. "Commitment Devices," Annual Review of Economics, Annual Reviews, vol. 2(1), pages 671-698, 09.
  44. Martin Binder, 2013. "Innovativeness and Subjective Well-Being," Social Indicators Research, Springer, vol. 111(2), pages 561-578, April.
  45. Christian Schubert, 2012. "Pursuing Happiness," Papers on Economics and Evolution 2012-01, Philipps University Marburg, Department of Geography.
  46. Shiv, Baba & Fedorikhin, Alexander, 1999. " Heart and Mind in Conflict: The Interplay of Affect and Cognition in Consumer Decision Making," Journal of Consumer Research, University of Chicago Press, vol. 26(3), pages 278-92, December.
  47. Daniel Kahneman, 2003. "Maps of Bounded Rationality: Psychology for Behavioral Economics," American Economic Review, American Economic Association, vol. 93(5), pages 1449-1475, December.
  48. Lades, Leonhard K., 2014. "Impulsive consumption and reflexive thought: Nudging ethical consumer behavior," Journal of Economic Psychology, Elsevier, vol. 41(C), pages 114-128.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:lev:wrkpap:wp_800. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Marie-Celeste Edwards)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.