Posts Tagged ‘libertarian paternalism’

Designing Wiser Choices

sometimes we need a nudgeYou’ve encountered these scenarios, right?

  • You enter a cafeteria and the first things you see are fresh fruit and a salad bar
  • You start a new job and the HR department presents you with documents indicating that you will automatically be enrolled in a 401K plan unless you opt out
  • You pull out of a parking space without buckling your seat belt and you hear an insistent chime while a picture of a belted driver flashes on your dashboard

Consider yourself nudged. In their delightful book, Nudge: Improving Decisions About Health, Wealth, and Happiness, Richard H. Thaler and Cass R. Sunstein introduce us to a way of thinking about decision-making that they call libertarian paternalism—libertarian because they strongly believe in the primacy of individual free choice; paternal because, all else being equal, they see nothing wrong with pointing individuals in the direction of the choices that are likely to be in their best interest.

Drawing a contrast with economists who operate on the fundamental assumption that humans are exclusively driven by self-interest, the authors explore some of the factors that predictably lead us to make bad choices:

  • A significant time delay between the action we take and its consequences
  • Too many options or options that are enormously complex
  • Infrequency, as when confronting a decision that we’ll make only once or twice in a lifetime
  • A lack of feedback to help us know whether we are choosing wisely, or even to know what we really want

In these cases one might suggest that experience or expert opinion could be of value to the chooser. Enter the “choice architect,” the person who—consciously or not—sets up the context within we choose. “If you design the ballot voters use to choose candidates, you are a choice architect. If you are a doctor and must describe the alternative treatments available to a patient, you are a choice architect.”

The theory has broad implications for policy makers in every field—and in every home!  In fact, every one of us is a choice architect. Every day we design conditions that influence our own choices. Which seating area is more inviting, the one where I watch TV or the one where I read? Have I positioned the reusable grocery bags so that it’s impossible to leave for the store without them?

Once you know what you want to say yes to and what you want to say no to, what steps can you take to nudge yourself toward your best choices?