Richard H. Thaler & Cass R. Sunstein, “Libertarian Paternalism Is Not an The idea of libertarian paternalism might seem to be an oxymoron, but it is both. Libertarian Paternalism. By RICHARD H. THALER AND CASS R. SUNSTEIN*. Many economists are libertarians and con- sider the term “paternalistic” to be. Libertarian Paternalism. By RICHARD H. THALER AND CASS R. SUNSTEIN’. Many economists are libertarians and con- sider the term “paternalistic” to be.

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This page was last edited on 16 Decemberat What they in effect are saying is that unless someone meets the textbook criteria for rationality and information, he is not really choosing in the full sense. He has a choice: People often do regret their choices.

To return to the transplant case, if the state says to people that their organs will be sunsteib from them unless they explicitly direct otherwise, it is claiming to set forward the terms under which people can retain control of their own bodies.

There seems paternalis “irrational” about this preference, but if someone has it, purchasing the extended warranty makes sense. Those who wish to preserve liberty must take people’s actions as they find them, not substitute for them “better” or more “rational” actions, based on an assessment of what people “really” want.

After all, doing so may enable them better to achieve what they “really” want — as experts, suitably instructed by Thaler and Sunstein, determine. He cannot avoid the choice altogether, so long as he wishes to offer the plan.

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He strongly prefers that payments for breakdowns be handled in advance. His faulty reasoning does not count as part of his free choice. Libertarians need not deny obvious facts.

Given the authors’ wide net, few actions count as rational choices. They suggest that influencing choice is unavoidable: But libertarians can support it, because it forces no one to donate. They offer as a case of irrationality purchasing an extended warranty for household appliances.


There has been much criticism of the ideology behind the term, libertarian paternalism. Such a power does not destroy, but it prevents existence; it does not tyrannize, but it compresses, enervates, extinguishes, and stupefies a people, till each nation is reduced to nothing better than a flock of timid and industrious animals, of which the government is the shepherd.

Thaler and Sunstein might respond in this way: Is it not, in a free society, up to them to assess the costs of doing so, weighing them against what they gain from smoking? Thaler and Sunstein thus have yet another way to question people’s choices: Behavioral economists attribute this to the ” status quo bias “, the common human resistance to changing one’s behavior, combined with another common problem: Those who are making an informed deliberate choice to put aside zero percent of their income in tax deferred savings still have this option, but those who were not linertarian simply out of inertia or due to procrastination are helped by higher paternalismm contribution rates.

It is also asymmetric in the second laternalism Thaler and Sunstein suggest that paternnalism change the default position. Thaler and Sunstein offer a further argument for the nudges they favor.

Whether or not they have ever studied economics, many people seem at least implicitly committed to the idea of homo economicusor economic man — the notion that each of us tjaler and chooses unfailingly well, and thus fits within the textbook picture of human beings offered by economists. If people do not “really” choose their actions, why not forcibly restrict them? Instead, the state needs to step away entirely and allow people to dispose of their organs as they wish. Setting the default in order to exploit the default effect is a typical example of a soft sunsyein policy.

Libertarian Paternalism | Mises Institute

From Wikipedia, the free encyclopedia. Thaler and Sunstein have set themselves a seemingly impossible paternalosm. View the discussion thread. What right have other people to a say in the matter? In current American law, people are free to direct that their organs be made available for transplants after they die.

Will not the supposed libertarian policy defended here lead to much unnecessary unhappiness? Rather, he wants certain feelings, e. Unless, though, they have filled out a donor card, doctors who wish to transplant organs must secure the consent of whoever has legal custody of the body. This is hardly libertarian. It is all right to render it difficult for people to make certain choices, as long as doing so does not impose substantial costs on them.


Libertarian paternalism – Wikipedia

Retrieved 4 July But the real issue is not the inevitable progression of snustein slippery slope but the rational basis for the paternapism in the first place. Thaler and Cass Sunstein. For other uses of “soft paternalism”, see paternalism. Why not rely on a free market in organs, rather than concoct schemes to restrict liberty in the guise of preserving it? Given these uncontroversial characterizations of the two positions, is it not obvious that they cannot be combined with each other?

Grynbaum November 7, Behavioral economics Social proof Default effect Libertarian paternalism Choice architecture Social sunwtein Design for behaviour change. Until recently, the default contribution rate for most tax-deferred retirement savings plans in the United States was zero, and despite the enormous tax advantages, many people took years to start contributing if they ever did.

Why not allow transplants, unless someone has signed a declaration forbidding that his body be used in this tthaler An obvious objection to their proposals arises, and their efforts to respond to this objection form the theoretical substance of the book. Their escape from apparent contradiction is ingenious. Skip to main content.

Libertarian paternalism

Thaler and Sunstein do not suggest that rationality always requires suppressing the impulsive self, but often it does. What he “really” wants is that his preferences be fulfilled in the way best fitted to do so. Loyalty program Safety culture. The term was coined by behavioral economist Richard Libertaarian and legal scholar Cass Sunstein in a article in the American Economic Review.