Nudging Toward Good Policy

by Stuart Shapiro

One of the most important advances in public policy recently is the idea that government can “nudge” people toward good decisions.  The idea’s main proponents are Richard Thaler and former Obama regulatory czar, Cass Sunstein.  Yesterday, David Brooks provided a surprising vote in favor of this approach:

But, in practice, it is hard to feel that my decision-making powers have been weakened because when I got my driver’s license enrolling in organ donation was the default option. It’s hard to feel that a cafeteria is insulting my liberty if it puts the healthy fruit in a prominent place and the unhealthy junk food in some faraway corner. It’s hard to feel manipulated if I sign up for a program in which I can make commitments today that automatically increase my charitable giving next year. The concrete benefits of these programs, which are empirically verifiable, should trump abstract theoretical objections.

I’d call it social paternalism. Most of us behave somewhat decently because we are surrounded by social norms and judgments that make it simpler for us to be good. To some gentle extent, government policy should embody those norms, a preference for saving over consumption, a preference for fitness over obesity, a preference for seat belts and motorcycle helmets even though some people think it’s cooler not to wear them. In some cases, there could be opt-out provisions.

Even when it does nothing, government is setting default positions.  We are better off when those defaults produce social goods, like more organ donations, more future savings, and less wasteful energy consumption.

By: Stuart Shapiro

Stuart is a professor and the Director of the Public Policy
program at the Bloustein School of Planning and Public Policy at Rutgers
University. He teaches economics and cost-benefit analysis and studies
regulation in the United States at both the federal and state levels.
Prior to coming to Rutgers, Stuart worked for five years at the Office
of Management and Budget in Washington under Presidents Clinton and
George W. Bush.