Nudge and Democracy

In a forthcoming paper, I argue that nudging can be used to get people to make the choices that they choose. In other words, nudging can be used to overcome the problem of weakness of will. And Thaler and Sunstein clearly intend something like that wrt some of their nudges (IIRC; personally, if I were to defend nudging-style policies – and I do – I would look elsewhere for their articulation (and I do)). So for instance default options in 401-k policies, if I have the US terminology right, are ways of getting people to choose what they themselves identify as their goals. We can identify goals either on an individual basis, as in precommitment limits on gambling, or by polling (as with the 401-K example).

The “nudge” sounds like what I imagine the “poke” to be on Facebook.

Why, I’m sure the technocratic elite is very good at discovering technocratic elite’s real interests, and how to advance them.

Why does it have to be a technocratic elite? What if the decision makers are truly representative of the people they are nudging?

They could be that, and still wish to nudge, because they had time to look into the issues that most people don’t. The ideal democratic decision maker shares values and interests with the people he represents, but hopefully has time to be better informed, on account of being selected to make decisions.

The closer our decision makers are to this ideal, the less we need to worry about nudging – or for that matter, more serious pushing. But if our decision makers are so removed from the people that they can’t even be trusted to nudge, then we have far bigger problems, problems that won’t be solved by outlawing nudging.

I don’t understand the article at all. Given the authors, this is probably a failure in reading rather than a problem with the article, but isn’t Bloix obviously right in 3 — the ‘nudge’ concept is about recognizing that things like default-setting inevitably do nudge people toward certain actions, and so the nudging effects of policy decisions should be recognized and directed toward desirable ends rather than ignored and allowed to operate randomly?

And then, why is there a different problem with feedback on nudgy policies than with any other set of policies? I don’t understand the distinction being made between democratic policies and nudgy policies. If, say, Congress passes a law requiring all employers with 401K plans to enroll all their employees at the maximum contribution level unless the employees opt out or change the level, that’s a policy intended to nudge the employees to save more. But it’s also a policy made by democratically elected legislators, and if people don’t like it, they can make their feelings known at the polls, just like with any other policy.

There’s got to be something fundamental about the argument I’m missing.

Even so, democracy is far better than even the best-intentioned technocracy at discovering people’s real interests and how to advance them.

Is it in my real interest to enjoy a tasty cheeseburger, or avoid gaining more weight and raising my cholesterol any further? My voluntary behavior may not be a reliable guide to the answer. Or to take a more serious example, is it in my real interest to take a vacation or save more for retirement? Without a tax-funded forced retirement scheme practically everyone saved too little; that’s established historical fact. Were the technocratic elite wrong to impose Social Security on us?

What is a real interest and how do you know when you have found it? Without an answer to this notoriously slippery question, I don’t see how you can begin to evaluate the merits of different political systems at advancing people’s real interests.

ISTM that the commonness of self-defeating behavior renders the idea that people’s interests can best be discovered by asking them simplistic, at best. In a way it’s akin to the freshwater economic assumption that people will only take economic actions that are in their interests.

LizardBreath @ 9: And then, why is there a different problem with feedback on nudgy policies than with any other set of policies?

Is the problem not just that the nudge is adjusting people’s preferences consciously, instead of focusing on giving them choices, but that the nudge focuses on a part of the policy that isn’t usually considered the important part? (I just posted something on this and why it’s undemocratic here.

ISTM that the commonness of self-defeating behavior renders the idea that people’s interests can best be discovered by asking them simplistic, at best.

Plus people often don’t know what they want, or which is in their best interest; as most product designers learn to their cost at some stage. Ask a bunch of people in a focus group, or one one one, what they want and they’ll tell you. Build it for them, and they’ll probably hate it. Its not because they’re stupid, its just that predicting what you’ll want in the future is very difficult. Not that designers are necessarily much better at independently working out what people want of course.

* State pension schemes—Social Security, Canada Pension Plan—don’t just nudge, they coerce people into putting money aside for their old age.

Eh, no, it makes more sense to say S.S. coerces people into putting money aside for their generation’s old age. Most people don’t get back from S.S. precisely what they provided (some get less, some get more) so it really doesn’t make sense to characterize it as an individual deferment plan. It’s not a long-term certificate of deposit type thing. This is loosely related to why American lefties go ballistic every time someone tries to convert Social Security to an individual deferment scheme.

* Henry, any argument you make about a technocratic elite applies just as well to the managers of the welfare state unless I am missing something.

The ‘unless’ clause is very kind. My thoughts:

* Welfare provisions like basic income, universal healthcare, disability, Social Security, i.e. that don’t specify specific choices for use, aren’t readily susceptible to nudging. Choosing which subpopulations receive provisions isn’t really coercive unless people have a reasonable choice to choose which subpopulation they’ll belong to. (People can’t just up and decide to not be old, they can’t just up and decide to not be sick, and they can’t just up and decide to not be poor. I guess people could choose to get sick or intentionally become poor solely for the sake of receiving benefits, but that would be pathological.)

* If “public health care treats X but not Y” seems like nudging, keep in mind that people suffering from X or suffering from Y don’t really have the option of trading. Nudging only makes sense as a concept when people can choose to pass back and forth between the subcategories in a non-pathological way.

* You might say ‘encouraging preventative medicine or healthy eating by making it cheap’ is nudging, and I might casually agree, but it’s probably better to interpret this as government attempting to dispense its resources as efficiently as possible: if it’s the responsibility of government to assure that as few people get condition X as possible/feasible, expenditures designed to reduce incidence of condition X can take any variety of forms — the relevant measure is effectiveness in reducing incidence.

* Welfare provisions like public health care and WIC, that do specify precisely where and when and how the appropriated money is to be used, are functionally no different from any spending the government engages in to fulfill its responsibilities to the population. You could rephrase anything of the form “the government is providing me with access to X” as “the government is coercing me into spending some of its provisions on X” but then it’s no longer an argument specifically about the welfare state. Another item that might fall under this category is refusing to treat people with health condition X until they provably adopt behavior Y.

* The latter category is susceptible to technocratic abuse–witness the school lunch program in the U.S. for example, and I’m sure you have other examples–so it’s completely reasonable to demand that its mechanisms and its management and decision-making processes be transparent, accessible, and accountable to the population.

It’s also worth thinking about self-paternalism. Given that there has to be a default option, I’d prefer that it should be one that is good for me, rather than one chosen on some historical/legalist basis. But I still find the Sunstein/Thaler approach unsatisfactory for some of the reasons in the post and the comments

chris @11: Is it in my real interest to enjoy a tasty cheeseburger?

If Ralph Nader had gotten any help from Jimmy Carter or Tip O’Neill, in the form of a nudge to a Congress under intense pressure from big business, we would have had a Consumer Protection Agency in the late 1970s (possibly even headed by Nader). If we’d had a Consumer Protection Agency for the last three and a half decades, we would have had a far more robust consumer movement. If we had had a more robust consumer movement, we would have had more books and documentaries like Modern Meat, and they would have had wider distribution. And no one who has seen or read anything like Modern Meat could “enjoy a tasty cheeseburger.” I suspect I would actually gag if forced to eat one today.

The above fantasy is not intended to spoil the enjoyment of cheeseburgers (though I can’t bring myself to apologize to anyone on whom it has that effect), but rather to illustrate the fatefulness of nudges (or, in this case, the absence of nudges) and to further discussion of Chris’s useful and searching questions.

I like a good hamburger now and again. Nostalgia for my vanished teenage years, probably. For younger generations unfamiliar with the nostalgia I’m talking about, a quick glance at American Graffiti will give you some idea.

Nowadays, when I want one, I select and grind my own meat as the first step. This is undoubtedly an affectation, as it doesn’t address all the evils of hamburger consumption. Still, it does mean that I’ve been keeping up with the literature. I also smoke a pipe, which I’ve done for more than fifty years, but I wouldn’t think of defending as a categorical imperative.

We are what our experiences make us. Sufficient unto the day is the evil thereof.

There is very strong evidence that raising cigarette taxes lowers rates of teen smoking, providing large health benefits later in life. Do you think cig taxes should be repealed so that teens can make the decision whether or not to start smoking themselves?

Unfortunately for the right, Thaler and Sunstein did a pretty good job of exposing how deeply flawed libertarianism is – it is, in fact, an ideology built on homo economicus rather than human beings. T & S didn’t realise this when they wrote their book, which is a mark of the hole libertarians have dug themselves into.

‘presuming that technocrats understand what ordinary people want better than the people themselves’

This man has not read or understood the book. It is not about ‘governments versus markets’ neoclassical bizarre-o world; it’s simply that people are affected by social norms, framing, advertising and so forth. Their decisions are always influenced, whether it is by governments, corporations, other people. Why do libertarians not have a problem with corporations influencing which decisions people make?

Sure, there might be some problems deciding whether it’s better to ‘nudge’ people into eating an apple or an orange, but then, policy is tricky. Not every issue can be condensed into a glib, one sentence reductio ad absurdum.

Henry,

First: I can´t see the difference. It seems to me that top-down regulators also presume “to understand what ordinary people want better than the people themselves”. Also, both rulemaking procedures can be subjected to public consultation.

Second: regulators ever can try to detect their own errors, to correct them, and learn from them. International best-practice setters like OECD even suggest that stocktaking of regulation should be embedded in the regulatory process.

Third: even democratically elected representants of the people could choose to issue “nudge”-style regulation, I think.

Sorry if someone already brought these points to the discussion.

Watson,

Sure, but it is a very diferent problem: the resources assimetry between the public in general and special interest groups actually can make the public consultation process less efective. This is somewhat inavoidable and is at the heart of the idea of representative democracy. On the other hand the civil society can sometimes self-organize to confront this problem: in the very field of telecommunications, some bodies like EFF and Public Knowledge in the USA are instrumental in making a counterpoint to the lobbies of corporations. Sadly it´s not true in every country because this demands some capital, including human and social capital.

I’m worried about how much work the “diversity trumps ability” theorem and the like are doing. Isn’t there a serious problem in trying to read off policy prescriptions from formalized results that hold in artificial settings like this? It seems to me that unless the notions of “diversity” and “ability” are appropriately operationalized in the statements of these theorems, there’s a serious worry that you’ll get something no better than the equilibrium models of neo-classical economics in terms of what it tells us to do as a real society in the real world – that is, it’s probably right for large classes of circumstances, but also drastically wrong for some. Certain types of diversity are clearly useful for solving certain types of problems, but other types of diversity are far worse than ability at solving other types of problems. There’s a reason that most machines aren’t designed democratically, but rather by engineers (admittedly, with some amount of public input in some cases).

May I note vigorously that “democratic arrangements, which foster diversity” seems rather to assume its conclusion.

You could say that about almost everything the original piece has to say about democracy. Any discussion of the flaws in “democratic feedback” is notably absent; the people just plain know what they really want (or need — the possibility of a difference between these two things is not examined, even though it’s the whole reason for libertarian paternalism to exist in the first place) and they’ll tell you if you let them.

Democracy may still be the worst system except for all the others, but it would be nice to see at least a little attempt to defend that viewpoint, rather than just assuming away all its known flaws.

Mettler uses experiments to show how ordinary people can understand complicated policy questions and reach considered conclusions, as long as they get enough information.

Well, that solves everything! All you need to do is make sure that people with limited free time and little inclination to sort out information from misinformation nevertheless get enough (I presume accurate) information so that they can make complex policy decisions. Easy.

If they had that kind of information, they’d *be* the experts. The impracticality of training everyone to fully understand every area of policy is why policy experts were invented (and experts on every other subject, too).

If someone doesn’t actually have the information to make an informed decision, it doesn’t matter that they’re theoretically capable of understanding the subject if they did have that information — they’ll vote based on the mix of information and misinformation they have, not the full and accurate information you wish they had. Scale this up to a whole electorate and all of a sudden you need undemocratic impositions just to un-ban interracial marriage.

I can’t believe that the authors of this piece literally didn’t know anything about the history of democracies and their various blunders and crimes against their own people and others, so why did they write as if the vox pop was infallible?

groups of agents with diverse understandings of the world will solve difficult problems better than narrowly focused groups with higher expertise.

Maybe, but they’ll also solve them worse. How do you make sure that in a democratic system, the worse solution isn’t implemented in place of the better one? Democracies come to perversely stupid decisions all the time, even when better information is available.

Impose a rational process for selecting the most effective solution instead of the one the greatest number of people feel best about? That’s not very democratic. Indeed, if you did that, you’d be a lot like a technocrat.

I’m also a bit suspicious of characterizing this result as a “theorem”. If it’s a theorem, rather than an experimental finding, what are its premises? Are they approximately as realistic as EMH?

By all means consult experts, but the dialogue should go both ways.

Is this just a blatant strawman? Who suggests that the dialogue shouldn’t go both ways as a matter of course?

When the non-expert side of the dialogue is saying they didn’t come from no monkey, or that we need more tax cuts to reduce the deficit, or that the government should get its hands off government-run programs, you’re probably justified in ignoring what they have to say, but otherwise I don’t think “libertarian paternalists” suggest not listening to feedback. (I can’t speak for them, though. I’m just a little more wary of democracy than the original authors seem to be.)

Incidentally, Neil’s comment perfectly illustrates the misperception that technocrats seem to have about human nature. There’s no evidence that “weakness of will” is responsible for most people’s self-destructive or socially debilitating behavior.

This is the kind of debunked 19th century moralizing that leads people to punish fat people because they lack “willpower” and to hurl junkies into prison because of their alleged “weakness of will.” The available scientific evidence suggests that chronically obese people have different metabolisms than the rest of us (I am not chroncially obese, by the way, so this is not a self-apology — I’m 6 foot 1 and weigh 200 pounds), and the avaliable scientific evidence also suggests that circa 6% of the population have a difference in their brain chemistry that leads them to take narcotic drugs.

Many people assume that weight is mostly a matter of willpower — that we can learn both to exercise and to avoid muffins and Gatorade. A few of us can, but evolution did not build us to do this for very long. In 2000 the journal Psychological Bulletin published a paper by psychologists Mark Muraven and Roy Baumeister in which they observed that self-control is like a muscle: it weakens each day after you use it. If you force yourself to jog for an hour, your self-regulatory capacity is proportionately enfeebled. Rather than lunching on a salad, you’ll be more likely to opt for pizza.

Some of us can will ourselves to overcome our basic psychology, but most of us won’t be very successful. “The most powerful determinant of your dietary intake is your energy expenditure,” says Steven Gortmaker, who heads Harvard’s Prevention Research Center on Nutrition and Physical Activity. “If you’re more physically active, you’re going to get hungry and eat more.”

Source: TIME magazine, 9 August 2009, “Why exercising won’t make you thin.”

Source: Addiction and the Brain’s Pleasure Pathway: Beyond Willpower, by Nora D. Volkow, M.D.

Anyone who talks about mythical ‘weakness of will’ as the cause of most social pathologies can’t be taken seriously in these days of PET scans and cognitive neuroscience. This is a 19th century fairy tale and leads to the kind of long-debunked social darwinism that led Victorians to build debtor’s prisons in order to punish poor people for their supposed “lack of strength of character” that had purportedly led to their failure to make money.

BTW, I don’t understand at all the dichotomy between nudging and democracy. I can understand the argument that nudging is anti-libertarian, because true liberty demands that individuals must be free to make their own choices with no guidance from government, even if it kills them. But how is nudging less democratic than straight-out coercive regulation (e.g. it’s against the law to hire a willing worker for less than minium wage)? And if it’s not, then you’re arguing that all representative forms of government are evil and the only legitimate government is the Athenian polis. Is that the argument? Do we really need to spend time on it?

Is that the argument?

Attempts to modify people’s behavior so that in the aggregate they conform to a pattern that is structurally beneficial, regardless of how individuals or subpopulations are affected or feel affected, should not be undertaken untransparently by organizational bodies not democratically accountable to the populations whose behavior they are attempting to modify. One good empirical argument for this is that technocrats, like the financiers who tanked the economy, are fairly bad at doing what they purport to be doing. “Thaler and Sunstein’s ideas presume good technocrats can use statistical and experimental results to guide people to make choices that serve their real interests. … the technocrats [have] no systematic way of detecting their own errors, correcting them, or learning from them.”

[A second good empirical argument is that technocrats are bad at attempting to do what they purport to be doing, but that kind of dishonest hackery isn’t directly addressed in the paper. Good will is presumed.]

A third good empirical argument is that populations who receive accurate descriptive information are actually quite good at contributing to the decision-making process themselves.

And, offering an opt-out option as a means for softening the policy’s deleterious individual effects doesn’t excuse this kind of nontransparent manipulation, because the distribution of knowledge that opting out is possible inevitably won’t overlap with the distribution of people that would emphatically want to not opt in (from a technocratic perspective you can’t safely offer an opt-out information if you genuinely believe all the people who want to opt out will know how to and will–it screws up the aggregate, because that population is nontrivial).

If you’re offering an opt-out, and your system only works in the aggregate if not very many people opt out, something is desperately wrong. If so few people would opt out that it doesn’t affect the aggregate, then your nudge is pointless, if so many people would opt out that it affects the aggregate, then your nudge depends upon maintaining the general population’s ignorance that opt out is possible. In the latter case, why bother to offer an opt-out? Because it neuters some criticisms that opponents of the policy could make. That makes it a fundamentally dishonest practice.

That’s (in effect) the argument. Of course, in trying to make it more explicit and emphatic, I’ve overextended it (it is not literally true that opt-out policies are “fundamentally dishonest practice” e.g. a Whopper sandwich as not ‘fundamentally dishonest’ because you can opt out of onions and tomatoes). But the argument and especially its milder version from the NS paper doesn’t reduce us to Athenian polis, I don’t think.

#41 – “Attempts to modify people’s behavior so that in the aggregate they conform to a pattern that is structurally beneficial, regardless of how individuals or subpopulations are affected or feel affected, should not be undertaken untransparently by organizational bodies not democratically accountable to the populations whose behavior they are attempting to modify.”

Well, temp (#42) got there first, but this really is an argument that all government other than the town meeting is illegitimate. All government regulation is about modifying behavior. Seriously, I can’t believe we’re spending time on this. If your argument is that technocrats (the left-wing name for bureaucrats) are petty dictators who can’t be trusted, you’re a Ron Paul libertarian.

“If so few people would opt out that it doesn’t affect the aggregate, then your nudge is pointless, if so many people would opt out that it affects the aggregate, then your nudge depends upon maintaining the general population’s ignorance that opt out is possible.”

This is just wrong. The nudge doesn’t depend on maintaining the general population’s ignorance. It depends on the fact that most people don’t have a view about a lot of things. They don’t want to make a choice, and they certainly don’t want to spend their free time learning enough dry technical details in order to make an educated choice. So if you make the socially beneficial thing he default, they’ll do it. Not because they’ve been kept in ignorant darkness by evil technocrats, but because really, they don’t much care. But if you make them have to choose the socially beneficial thing, they won’t do it. Not because they’re anti-social, but because in addition to all the other crap of daily life, now there’s about a thousand insanely boring public policy thingies they’re told to learn about in order to make a bunch of informed decisions that they don’t really care about. They just won’t do it.

Really, if society was (1) made of people all as smart as Henry who (2) had unlimited amounts of time to do nothing but cogitate about public policy and (3) got the same kind of pleasure out of thinking about this stuff that Henry gets instead of (4) having strong negative emotional reactions to well-intentioned bossy people trying to teach them stuff they’re not interested in – well, even then, the negative analysis of nudging wouldn’t be correct. But it might be interesting. Which, at present, it isn’t.

The libertarian bit comes from the notion that you are providing people with choice. If they really don’t want to be nudged, they can take other decisions.

Maybe I’m wrong, but I’ve assumed “choice” goes beyond checkoffs. When you install Microsoft Windows, you get a “nudge” toward Internet Explorer. You can install a different browser, but that requires some technical knowledge, as well as trust that installing non-Microsoft apps is kosher. It also requires more work, unlike a checkoff. So nudging could cause some people to choose between what they think they want or need and what they have the time and information to take advantage of–different people than the people who’d have to choose if not for the nudge. There’s still “choice” but it’s kind of a bait-and-switch, like asking people to give themselves their own injections, and arguing it’s for their own good because it will encourage them to take responsibility for their own medical care.

Nudges are not “behind the scenes.” They are up front.

There’s a complete logical disconnect here – on the one hand, the electorate is able and willing to make informed and reasonable decisions on virtually every subject, no matter how complex or technical, and at the same time, the individuals that make up the electorate are so stupid, lazy, and passive that they can be manipulated simply by the phrasing of a question.

Note btw that the anti-nudgers contend that an informed people can make good decisions without being nudged. Who is going to do the informing. Presumably not the “supposedly smart and well-meaning individuals” (ie evil pointy-headed gummit bureaucrats and Harvard professors). Well then, who? Glenn Beck and Sean Hannity, I suppose.

And #47 – yes, indeed, corporate marketers are very familiar with nudging and do it all the time. Apparently nudging in the interests of profit-maximization is ok but nudging to improve the public health is tyranny. We really are in Ron Paul territory.

Informed opinion might get in the way of advertising and dogma.

There seem to be two kind of nudge being discussed – one is the familiar ‘incentives’ stuff like taxing cigarettes and booze. The novel kind seems as far as a cursory glance can tell to be based on this model of the organ donor. This is presented on the basis that no incentives or disincentives are being loaded onto the options, and – presumably if questioned T&S would say the idea is not to slip something through in the fine print (though why in that case an opt-out rather than a mandatory decision, with no default supplied, as part of various registrations etc?).

But we’re dealing with Cass Sunstein here, the guy who is at the same time crude and authoritarian enough to publicly call for the US govt to infiltrate ‘conspiracy’ websites, and naive enough to think this was not already happening. The thing about these nudges is indeed that they are supposed in some way to be furtive. And that means they are not designed to prompt fully informed and deliberate decisions, but to do something else – and I suggest it’s pretty clear that the ‘something else’ is to bypass the requirement to gain consent. There’s no further option.

Either there is

1. A situation in which changing the default option is enough genuinely to elicit real consent from people who would otherwise have withheld it out of inertia or something, despite being indifferent between the two options. This is not likely to be a frequently occurring kind of situation (terrific triviality?) and we are really looking at questionnaire and form design, the aim being to get attention and encourage people to express their preferences.
or
2. A situation in which people are being got to do things they would not have chosen to on the basis of being given their options clearly, with reasons. In this case, we have something dodgy going on.

Bloix actually makes a reasonable point, though backwards – that corporate power is full of this stuff – small print, inaccessible T&Cs, “Please exclude me from your exclusive offers and info mailing list” checkboxes, etc etc. I of course am very very angry about that just like everything else, so not impressed with it as apology for Sunstein.

Also – note the organ donor stuff is not paternalistic – the ‘obviously for your own good (but still here’s some prompting – that goes beyond advice yet falls short of incentive-adjustment)’ kind of case is going to be sufficiently rarem, isn’t it, that it too falls into ‘terrific triviality’ territory (unless we are now switching to discussion of akrasia – perfectly plausible given what else I know about him that Sunstein would fail to distinguish that issue).

Also, on the “diversity trumps ability” theorem of Scott E. Page. Annoying enough to merit a full devastating critique, but in the meantime, I’d agree with Kenny Easwaran @33, who is worried about how much work the “diversity trumps ability” theorem and the like are doing. Isn’t there a serious problem in trying to read off policy prescriptions from formalized results that hold in artificial settings like this?

I think the word ‘problem’ here is very well chosen. A serious and insurmountable problem, I’d say. Serious, insurmountable and grotesquely, mirthlessly risible, even.

I think we should be very clear that incentive changing policies such as sin taxes are not nudges. I don’t have the nudge book here, but I think a useful definition of a nudge would be something like
“a change in the choice architecture that leaves the expected pay-off (and thus the expected behavior of a perfectly rational actor) unchanged, but is expected to change the behavior of typical actors in a way that is deemed desirable”.

The whole point (and why they’re calling it libertarian) is that you don’t punish people who make the “wrong” decision – you just make it easier to make the “right” one. Tobacco taxes may be good or bad, but they’re not libertarian – paternalistic or not.

A good example of an undesirable (at least from the perspective of most people here) “nudge” reform is the Argentina pension privatization. Menem instituted a mixed public/private system in the 1990s and people could choose between a public PAYGO system and a private fund system. Crucially, the default was to randomly assign people to one of the private funds. (The Kirchner government actually reversed that default – which dramatically changed new member numbers in favor of the public system. Unfortunately from a polisci perspective, shortly thereafter the government completely nationalized the system killing the opportunity for a very nice publication.)

I’m also confused by the Farrell Shalizi piece, not so much because I’m unsympathetic, but because I don’t understand their critique. Is it that people are wrong about whether “nudges” work? That’s what the organ donation example would work. I’m very sympathetic to this critique, but it only implies that nudges may be useless, not that they may be bad.

The second critique is that nudges may nudge people to the wrong policy goals (e.g. private pension funds, I guess). Here I am a bit more confused and so, I’d argue, is the article. Is the problem that the nudges are made “secretly” and obscured from citizens?
Is it that they’re replacing other policies? Both of these are justified – nudging can’t and shouldn’t replace public policy and it should be upfront about its purpose and existence.
But let’s assume for a moment that these two are given (and I agree that in reality they’re not) – would it really be a bad idea for a government – democratically elected after all – to think about the way it presents its citizens with choices?
To go back to the Argentine example – Menem’s government was quite clear about the fact that they thought people should switch to the private system. Given that that was the transparently stated goal – was it really wrong to set up the system in a way that made it more likely for people to choose the private system (and vice versa – was the Kirchner gov’t, vocally in favor of strengthening the public system, wrong to change that default?).

Just to clarify – I take it that an operative and efficacious ‘nudge’:

1. is essentially behaviour modifying: it elicits behaviour which would not otherwise have been exhibited.

2. does not involve deception, misrepresentation, ‘psychological manipulation’ (def.: TBA; e.g.: crude conditioning), physical manipulation, mistake, inadvertence or ignorance: it is autonomy preserving

3. is something over and above argument, information and accurately assaying preferences: it is at least in part non-collaborative.

1., behaviour modification, and 2., autonomy preservation jointly entail that a nudge alters what people choose and that it does so without merely providing support to a deliberative decision. What can you do to change what a person decides, other than assisting or hampering them in reaching their decision? Change the decision they face.

Which is where incentives come in: threats and offers; deterrence and promotion; coercion and inducement. Altering the payoffs. But we already know about incentives. They are nothing new. Nudges, if they are to be interesting per se, must be a distinctive kind of incentive alteration. A nice, unobtrusive, light-touch libertarian kind.

So: could a nudge be a Libertarian incentive alteration? That is to say, one which does not involve any non-contracted alteration of jural relations – rights, obligations, etc. – by the nudger? This would rule out most usual kinds of stick-and-carrot incentives; and would seem to leave only things like the organ donor case.

But even that case, depending on how it’s conceived, could fall foul of the libertarian constraint. A genuine ‘opt out’ system would involve ‘imposing’ the liability to (have one’s remains harvested?), and the substantive burden of opting out.

On the other hand, a system which only frames the issue as an opt-out, by setting the default option in a form, say, would depend on genuine and occurrent, if implicit, opt-in and so could be libertarian in this sense. But the way in which the nudgee’s decision is altered must still be compatible with the libertarian constraint, and is still obscure. The incentive offered (and I suppose thinking now mainly of negative incentives) must, perhaps like a boycott, involve rightful action by the nudger.

But in the context of a Leviathan set up to regulate behaviour by legislating changes to jural relations, it’s hard to see how this can be applied. The libertarian (Libertarian) constraint faces a dilemma – either it takes seriously the idea that the state can carry out ‘rightful actions’ in pursuit of the general good, actions which may impose novel burdens on others, or it concedes that there is no body in a position to start issuing nudges.

We recall of course that the nudge can’t involve anything like fraud that would interfere with autonomy. Perhaps though, true to form, a Libertarian conception of nudges would rely on – without acknowledgement – the kind of sharp practice that keeps the wheels of consumer capitalism grinding. As mentioned, consumer contracts are hemmed in on all sides by ‘nudges’.

Nudges might in economistic terms be those bits which exploit the inferior bargaining capacity (not bargaining power) of the consumer: the high (subjective) cost of wading through reams of small print (or on the web, scrolling through one of those little peephole windows they hide the T&Cs in), or short-con psychological trickery like exploiting various cognitive biases – perhaps a tendency not to alter default options. But of course this is not something we wish to applaud, but rather to drive into the sea.

Nudges are meant to be less heavy-handed than penal provisions or imposition of duties, and I suppose less – obvious? – than tax breaks. So maybe a nudge is a de minimis incentive. E.g. changing the default option on a form places the onus on the citizen to make an opt-out decision – not much to ask, I suppose the idea is supposed to be. I do not really suppose that whatever the facts alleged about peoples’ responses varying according to presentation, they are to be explained by a rational decision to minimise costs which are – we suppose at this point – already de minimis. Far more likely that this kind of nudge relies on the sharp practice suggested above in connection with the vulgar libertarian, or on genuine indifference, either of which disqualifies it from true nudge status, in the former case because it interferes with autonomy, in the latter because the same effect could be achieved by providing information and argument, and a modicum of encouragement.

The other problem with this approach as a basis for public policy is that what counts as de minimis tends to be elastic, and then ‘de minimis’ gets amended to ‘reasonable’, etc.

The only other way of tightening up an understanding of what nudges are about that I can think of is to consider the unobtrusive nature of nudges not as a matter of the light touch, but of sleight of hand. Rather than a little dig in the ribs to remind us to do the right thing, this is a sneakily insouciant nudge that imperceptibly diverts our course. The nudge is not essentially a small or juridically neutral change of incentive. Maybe it is an incentive, according to the official line anyway, but the distinctive thing about it is that you’re not really meant to realise what is happening – that is the common feature so far as I have bothered to make out, and that the abiding factor running through the whole idea.

I mention above Sunstein’s dodgy Hooverite views about conspiracy theories and the need for more sneaky manipulation of websites by state spies. I may have done an injustice by suggesting he’s naïve about the extent of this kind of state activity in the US – I suppose his role is more to normalise it – a bit like Dersh with torture.

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So I reckon the problem with nudges is that they are sneaky and probably (therefore) autonomy denying because reliant on exploiting irrationality, ignorance, etc. This is an issue of democracy, but in the first instance one orthogonal to the top-down/bottom-up dimension that I think Henry is talking about.

The whole idea of nudges presupposes that there is sometimes a case for the state to try and alter the behaviour of its citizens. The nudge is first and foremost an undemocratic thing because it is non-transparent – and often in fact reliant on some form ignorance. And neither of these are ways in which a democratic state (its officials) would be able to interact with the citizens who have created it (their posts).

Given non-transparency, Henry’s point about a lack of feedback of the technical-advisory or of the authoritative kind stands, but not, I think, as the ‘key problem’:

This points to the key problem with “nudge” style paternalism: presuming that technocrats understand what ordinary people want better than the people themselves. There is no reason to think technocrats know better, especially since Thaler and Sunstein offer no means for ordinary people to comment on, let alone correct, the technocrats’ prescriptions. This leaves the technocrats with no systematic way of detecting their own errors, correcting them, or learning from them. And technocracy is bound to blunder, especially when it is not democratically accountable.

As I’ve suggested before, I don’t think the ‘paternalism’ bit is apt at all, and if the term has been put forward by nudge-proponent it would appear a characteristically devious ploy of copping to the lesser plea. Beiog manipulated for your own good is, one supposes, considered more attractive than being manipulated for a greater good which may or may not be any better – or even worse – for you. In fact, individualistic paternalism (impose costs on A only for greater benefit to A) would have Pareto-improving effects so there’s that whole official-dogma-friendliness aspect, too.

1. is essentially behaviour modifying: it elicits behaviour which would not otherwise have been exhibited.

This is essentially meaningless because “otherwise” cannot be defined. Any choice is structured and presented to the chooser in *some* way. There is not some privileged neutral way of choosing to which all others must be compared (and judged inferior for their non-neutrality). That’s why it doesn’t make a lot of sense to talk about an alternative to nudging — the alternative to a nudge *is another nudge*, the only question is in what direction.

Or to put it another way, almost any behavior is behavior that would not have been exhibited under *some* set of alternative conditions, the question is what set. The basis of the theory of nudging is the fact that two sets of conditions *neither of which involves coercion* can nonetheless produce different behavior in a significant number of people. So if one of those sets of conditions produces outcomes more conducive to the public good than the other, it ought to be preferred as a matter of policy, rather than… what? Maintaining the status quo whatever it is? Flipping a coin? I’m not entirely clear on what the alternative to nudge awareness is supposed to be, anyway.

2. does not involve deception, misrepresentation, ‘psychological manipulation’ (def.: TBA; e.g.: crude conditioning), physical manipulation, mistake, inadvertence or ignorance: it is autonomy preserving

A system of decisionmaking that never involved inadvertence or ignorance would be a lovely thing, if it could only exist. Nudging (of the paternalistic kind, anyway) is basically about minimizing the damage inflicted by inadvertence or ignorance by trying to predict what people would choose if they were well-informed and took the time to think about it, and then nudging them into choosing that thing even if they *don’t* take the time to think about it (while not explicitly coercing them so the rare people who would actually make a different considered choice can still do so — obviously this opt-out shouldn’t be allowed when it constitutes free riding or worse; people should not merely be nudged into paying taxes or not polluting, for example, they should be required by law to pay them).

On the other hand, non-paternalistic, self-interested nudging is already widespread, influencing the decisions of anyone who doesn’t take the time to think it over or doesn’t have the information to do so to choose in a way that is beneficial *for the nudger*, not necessarily for the nudgee. This is already endemic, in addition to self-serving information (e.g. advertising) and even outright misinformation (I won’t start a flamewar by naming names). So the idea that people would be making their decisions in a vacuum of untrammeled free will if not for those nefarious paternalists is ridiculous (and I hope nobody is actually trying to advance it and I’m merely misunderstanding them).

P.S. It’s been a while since I’ve read the book, but I’m pretty sure that Thaler and Sunstein are clear on the point that, e.g., cigarette taxes are not a nudge. By changing the practical consequences of one of the alternatives, cigarette taxes change the alternatives themselves, not merely the way they are presented to the chooser. Obviously, offering a cash incentive to behave in a certain way can change behavior, and sometimes government should do that, but that sort of thing is outside the realm of nudging, whether you like it or hate it.

#60- sarcasm is easy if you don’t what you’re talking about.

Here’s a real-world example. Say an employer offers a 401(k) plan with many, many choices: you can choose a percentage of your income to be withheld. You can choose among a dozen investment vehicles (stocks, bonds, small-cap, mid-cap, growth, income, low-risk, higher-risk, emerging markets, Pacific markets, domestic markets … ). All described in neutrally-presented, government-mandated detail.

The employer doesn’t give you any instruction on what to choose – you’re free to do what you want.

The real-world result of this is that a large percentage of young people choose not to participate. It’s just too confusing and retirement is too far away anyway. They take the papers home to look at, they never do. So they lose the tax benefit of the 401(k), they don’t save, and they miss out on the most important years for preparing for their old age.

In effect, the government rules on the presentation of full, neutrally stated information is a nudged not to participate. Not intentionally, no, but asking people to make a complicated choice that puts a burden on their time and energy is a nudge. Once there’s choice, there’s nudging. There’s no such thing as a neutral way to give people a choice.

If in addition to putting a vast amount of strange and difficult information before the employees , you also put together a few packages: “a choice for people in their 20’s or 30’s with no dependents;” “a choice for people in their 30’s who are starting a family;” “a choice for those nearing retirement age,” etc., then participation rates go way up. More sophisticated people can still put together a plan that they like, but the great majority of employees, who don’t want to learn about this stuff are far more likely to participate.

Under the current rules, the government claims to want to encourage people to save for retirement, but in fact it discourages them from doing so. But apparently, making it easier for people to make a choice that is good for them is a fateful step on the road to serfdom.

@Turner 61 – I think you’re completely misreading Bloix @49.
Nowhere does s/he “adopt the standard line against them about bureaucrats not being able to decide things for people.” In 49 he suggests that there is a contradiction in the anti-nudging position because it has to rely on bureaucrats/experts to present unbiased information. (I don’t think that part of his argument is particularly strong, but it’s a pro-nudging argument).

Ah, it appears I have reading comprehension problems. My apologies.

Salient: If so few people would opt out that it doesn’t affect the aggregate, then your nudge is pointless

There are scalable nudges, like tobacco taxes, but there are also what might be called exhaustive nudges: supposing we’ve created an organ donation program as a matter of public policy, and we don’t want participation to be mandatory, doesn’t it have to be either opt-in or opt-out? That is, aren’t we faced, in at least some policy areas, with a situation where the only structural possibilities are either nudging or outright coercion? We can have volunteer military services (but then “nudge” potential volunteers by offering scholarships, low-interest home loans, or other scalable incentives) or we can have conscription. Is there a third possibility that’s neither nudging nor coercive? I can’t see one.

…oh and I confess that what’s apparently the standard definition irritates me, and for exactly the reason you bring up–every act of the state is either a nudge (if it gives you options) or coercion (if it doesn’t). Well, bleh, we already have a word for the former category: non-coercive. I guess nudge is more evocative, and better acknowledges that the state’s exerting pressure on a person even when not coercing them, so, ok.

Also, ‘nudge’ isn’t that thrilling a concept — I don’t think it comes down to much more than “The structure of programs incorporating choice should be thoughtfully designed to encourage the choices policymakers believe to be beneficial.” Which seems to me to be obviously true, but also obviously not terribly revolutionary, except insofar as people hadn’t paid attention to how powerfully the manner in which choices are offered can influence the choices people make.

Yes, but Sebastian(1), the more transparent – the more obtrusive, or the more genuinely informative – it is, the less of a nudge it is. Or so I assert, based on attempting the work that T&S were not really interested in, which is coming up with a coherent, distinct and interesting concept.

Your triumphant brandishing of a supposed counterexample is like a defender of mainstream n-c microeconomics rummaging around in the bottom drawer to find one of JQ’s papers – see, economics isn’t dominated by a doctrinaire bullshit model! Or Tim Worstall claiming that market capitalism is the greatest by reference to social democratic mixed economies. Or Dershowitz, who, his mind being free from the bugbear of consistency, can always find a quote in which he’s said the opposite of what he’s accused of arguing.

The fact is, you’ve got three kinds of supposed nudges, which can be illustrated by the 4 latest posts on the nudges blog.

1. http://nudges.org/2011/10/11/heres-how-washington-states-nudge-for-state-park-donations-works-via-its-web-site/

This one actually shows two kinds I’ve mentioned. The first is the one in which no default has been selected but a choice must be made (in order to achieve something else which it’s known the user wants): this one is not a nudge, and is not manipulative.

The second is, if anything is, a nudge, having a preselected default – which is of course there to get more people to donate. Presumably a range of underlying mechanisms, some of which may be genuinely perverese laziness or other oraationality about changing options (but one would like some clear evidence about this really). Others, basically light-touch manipulation, like making you feel a bit guilty at unchecking the box – is this OK? It’s kind of minimal, and after all, guilt is guilt – perhaps this is equally well-described as removing a possibility to ignore or stifle guilt (Paterno-ism)?

But of course it might not be guilt but conformism, just pure suggestion, some niggling feeling that you’re expected to donate and maybe it might ion some way be held against you if you don’t. These seem pretty overblown concerned in this case don’t seem a problem here because it’s no big deal – people ought to be able to cope with this minor kind of nudging, and even if they don;t it’s only $5. If they really cared that much about the $5, we say, they wouldn’t be so easily manipulated. (Yes, see how already it up to you to show why the matter is important enough – and of course that you are plaint and feebleminded enough! – for the manipulation to count as going beyond the normal level of Machiavellianism we just have to put up with.

But then of course there will be those who just aren’t really paying attention. They don’t, by the looks of it, have to make any further confirmation. Perhaps they will at least be reminded about it at the end when they pay the licence fee + any donations. They would then have the chance to crash out of the process – perhaps even to go back and change it in some reasonably graceful and convenient way. But nonetheless, no-one who designs default options (clue: ‘default’) is unaware that it will be the upshot of all those cases in which for one reason or another people fail to read the question and simply proceed to the next step.

But apart from tripping up the unwary, this example seems relatively harmless, largely because the manipulation (cf ‘secret’) involved is relatively minor . And as Lizardbreath says, edious, dull, uninteresting, nothing new or distinctive. But that’s largely because its a getting close to something else, which is not so harmless, which is the kind of thing that -filthy marketing scum- top creatives get up to:

2. http://nudges.org/2011/10/09/where-is-behavioral-economics-headed-in-the-marketing-worlding/

Which is, of course the deliberate attempt to trick people – or for those with a Theresa-May-like instinct for deniability, the ensuring that no negative weight whatsoever is placed on the possibility that people might make mistakes, and plenty of weight on an estimate of how many positive respionses will be gleaned. This is where we get to the realm of consumer capitalism and the marketers.

Make complaining or cancelling as difficult as possible, applying and paying as easy as possible. Put dominant, fluent salesfolk on the application line, timid and baffled sounding paupers in far way lands on the complaints line. This constant manipulation, the need for such watchfulness and suspicion (if you dopn;t have money to spare) is a pretty fucking demoralising way of interacting with an organisation. Even more demoralising when it’s not just all the corporate entities that have had teams of lawyers and psychologists and marketers and copywriters working on honing the script and every aspect of your interaction with them, but the government agencies, too. that’s not at all dysfunctional or apt to give rise to a paranoid mindset or anything, oh no – for Sunstein, it’s something to be encouraged with glee. (Just like the government infiltration of ‘extremist’ (i.e. 9-11 sceptic, dissenter, confabulator etc) websites.

These more extreme variants on bypassing rational faculties (oh yeah, did I mention all the emotional manipulation these marketers are employed to carry out – if you push button y, you can get x, did you know 10% have a mild phobia/OCD response to bacteria – just do an ad to scare ’em shitless and we’ll sell these antibacterial banister-rail wipes just to them. It’s the same basic type of attitude as ‘bend back the little finger like this they will scream for mercy’, etc.

Now the more extensive kind of marketing tricks and manipulations aren’t really supposed to be what the headline nudge is like, but they are just a short distance down the slope from the advertised tedious examples. Indeed here’s one that’s only a tiny distance furtyher down: This one: http://nudges.org/2011/09/21/a-devious-little-marketing-nudge/ – note it’s actually described as ‘devious’.

3. http://nudges.org/2011/09/13/the-landfill-nudge-at-the-university-of-pennsylvania/ – I can’t see why T&S should be alloweed to claim this one for their team – it’s a perfectly sensible idea – to indicate, by way of specimens, which items should go in the recycle bin and which the ‘landfill’ bin. Specifying ‘landfill’ rather than ‘waste’ or ‘non-recyclable’ perhaps helps to remind people what will happen to the stuff they dump in that bin, bujt there’s nothing distinctively ‘nudgy’ about that – just a sensible and not-too loaded way of reminding people of the relevant info.

Basically what you’ve got here is a two step – there are acceptable nudges but they are small potatoes and rather uninteresting, or even as with the recycling, scarcely nudgeous at all. Then there is the whole toolkit of the marketer, including pushing everything as far as the law will permit, working on the grey areas, the interstices of the capitalist system (of which there are plenty) to wring out every last drip of advantage. This is where I see the real advantages for governments of making use of nudgery: behavioural economics, meaning pretty much the portion of social psychology that is useful to those who want to know how to sell stuff.

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Cranky – so yeah, what’s the backstory you mention? I mean obviously he is one of the celebrity-careerist pseudo-intellectuals that Harvard likes to fill its chairs in the schools of economics and law (and presumably anything else related closely to politics). And obviously he is on message (“Cass Sunstein is…industry’s best friend inside the White House. He doesn’t like regulations.”; the conspiracy-theorist-as-dangerous-extremist bullshit). But is there some specific connecti0n to financial firms?

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+ just to repeat a general point – I don’t think the ‘technocrats’ and ‘top down’ angles – bureaucrats not being able to decide things for people – are really relevant to the question in, as it were, the object language. The question is ‘should the government utilise nudges to direct peoples’ decisions (for their own or the general good)? The fact is that a government is going to be involved in doing things which not everyone necessarily goes along with as a matter of course (to promote the good – what else?). Given that, the question of ‘nudges’ could arise for any form or style of governance in general.

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chris – [“elicits behaviour which would not otherwise have been exhibited”] is essentially meaningless because “otherwise” cannot be defined Yes it can: it’s if the nudge policy weren’t implemented or, in most cases, the status quo (if the status quo is wrong in some other way – perhaps too many nudges – that may of course be worth taking a squint at, but doesn’t mean waving through the new nudge proposal). A nudge is as much a piece of policy as a drive, campaign, scheme, edict or prohibition – that’s the whole point of the discussion.

the alternative to a nudge is another nudge – not generally; usually the alternative to a nudge is ‘drift’ – that is, people making their unnudged decisions (or anyway manifesting their unnudged behaviour). The prevailing conditions in which people make (or don’t make) choices are not to be confused with ‘nudges’ – a nudge needs a nudger.

That’s not to say that people shouldn’t be assisted with everything they need to make choices – for example info of suitable simplicity. Further still, we can agree that there can be a tyranny of choice, given our limited capacities. Only the very rich can delegate enough of the administration of their affairs (their estate) to experts to get even close to the idea of the fully rational optimiser. The rest may use heuristics or symbolic value to make decisions under uncertainty. They may make a higher-order choice, perhaps based on rough assessment of best and worst cases, not to make the choice at all – not to invest the effort required to actively make the choice. P ). At the limit, they may be entirely unaware that there is any such choice.

So there may well be decisions which people should be relieved of the need to make. Some things may – of course – be such that there are policy reasons for not providing various alternatives (such as to opt out taxation by simple declaration). This is important, because the ole centrist Sunstein is here talking about being ‘libertarian’ – and does seem to mean, for example, that payroll deductions in support of basic pension provision (cf healthcare, etc) are not something that could be simply imposed by the res publica. ‘Nudges’ are required because the private system isn’t working – at the risk of overdoing the old Brecht quote, consumers have forfeited the trust of the government. Small wonder the remedy looks to be the kind of relentless trickery that corporate marketing departments are inexorably impelled towards by ‘market discipline’.

Or to put it another way, almost any behavior is behavior that would not have been exhibited under some set of alternative conditions, the question is what set. The basis of the theory of nudging is the fact that two sets of conditions neither of which involves coercion can nonetheless produce different behavior in a significant number of people. So if one of those sets of conditions produces outcomes more conducive to the public good than the other, it ought to be preferred as a matter of policy

But the point is to consider the mechanism at work, and reject it if it’s abusive or manipulative, relies on or unavoidably involves material ignorance, etc. There are standards for how a state apparatus should be able to intereact with its citizens, aren’t there.

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Bloix : More sophisticated people can still put together a plan that they like, but the great majority of employees, who don’t want to learn about this stuff are far more likely to participate.

I think this has a lot to do with why this sort of thing is so attractive to Sunstein and all his rioch mates. Those of us in the know about this kind of thing – and especially those of us who have lawyers and accountants and PAs to do all this shit for us – need haev nothing to fear from these ‘nudges’. They’re easy. We’re well past all that shit and onto advanced tax avoidance. It’s only the mugs (suckers) that will get nudged around – thsoe who are too busy, tired, ignorant, etc. to know any better. It is the illusion of universal freedom, but in fact it’s total freedom only for winners; for the losers, unwitting obedience.

(I’ve gone on a bit too long here already I reckon , but for an example of this kind of supposedly universalistic and free system which is in fact skewed in the same way, see this comment (2nd half) about unauthorised overdraft charges.