Forcing People to Choose Is Paternalistic.

• Author: Sunstein, Cass R.
• Position: Evaluating Nudge: A Decade of Libertarian Paternalism

1. INTRODUCTION

   When you enter a taxicab in a large city, and ask to go to the airport, you might well be asked this question: "What route would you like me to take?"

   If you are like many people, you will not welcome that question. You might even hate it. After all, it is the business of the driver to know how to get to the airport, and in any case the driver almost certainly has access to a GPS device. For you, the question--asking you to choose--is a kind of mental tax, cognitive for sure (because of the need to think) and possibly hedonic as well (because it is not exactly pleasant to ponder how to get to the airport). To be sure, the tax is likely to be small. But it might well be unwelcome.

   Whenever a doctor or a lawyer asks a battery of questions to a patient or a client, a possible reaction might be: "On some of these questions, why don't you decide for me?" If the emotional stakes are high, and if the issues are difficult, the hedonic and cognitive tax might be very high. And whenever public officials require people to fill out complex forms to qualify for training or for benefits, the tax might turn out to be prohibitive, at least for some people. It might lead them not to apply at all. It is for this result that complex form-filling requirements are not merely a paperwork burden; they can undermine and even undo the underlying programs. Form-filling can be a curse.

   In this light, consider three problems:

   1. An online clothing company is deciding whether to adopt a system of default settings for privacy, or whether to require first-time users to specify, as a condition for access to the site, what privacy settings they would prefer.

   2. A large employer is deciding among three options: (1) to enroll employees automatically in a health insurance plan; (2) to ask them to opt in if they like; or (3) to say that as a condition for starting work, they must indicate whether they want health insurance, and if so, which plan they want.

   3. A utility company is deciding whether to adopt for consumers a "green default," with a somewhat more expensive but environmentally preferable energy source, or instead a "gray default," with a somewhat less expensive but environmentally less desirable energy source--or alternatively, to ask consumers which energy source they prefer.

   In these cases, and countless others, a public or private institution, or an individual, is deciding whether to use some kind of default rule or instead to require people to make some kind of active choice. (I shall say a good deal about what the word "require" might mean in this setting.) For those who reject paternalism and who prize freedom of choice, active choosing has evident appeal. Indeed, it might seem far preferable to any kind of default rule. It respects personal agency; it promotes responsibility; it calls for an exercise of individual liberty. It seems to reflect a commitment to human dignity.

   In light of these considerations, many people might argue that active choosing deserves some kind of pride of place, especially if it is accompanied by efforts to improve or "boost" people's capacities, perhaps by providing them with information, perhaps by increasing their statistical literacy. (1) In social science parlance, the best approach might be to strengthen System 2, the deliberative system of the mind, rather than to ignore it, or to exploit or enlist System 1, the automatic or intuitive system. (2)

   In recent years, there have been vigorous debates about freedom of choice, paternalism, behavioral economics, individual autonomy, and the use of default rules and choice architecture. (3) Invoking recent behavioral findings, some people (including the present author) have argued that because human beings err in predictable ways, and cause serious problems for themselves, some kind of paternalism is newly justified, especially if it preserves freedom of choice, as captured in the idea of "nudging" or "libertarian paternalism." (4) Consider a GPS device, which nudges; perhaps we need GPS devices everywhere. Others contend that because of those very errors, some form of coercion is needed to promote people's welfare. They believe that as a result, the argument for choice-denying or nonlibertarian paternalism is strengthened. (5)

   These claims have been sharply contested. A possible response is that public officials are prone to error as well, and hence an understanding of behavioral biases argues against paternalism, not in favor of it. (6) If government makes mistakes, it might nudge people in the wrong direction; it might also have an insufficient appreciation of diversity within the relevant population. The "knowledge problem," rightly emphasized by Hayek, potentially affects all decisions by government, (7) and behavioral findings seem to compound that problem because they suggest that identifiable biases will accompany sheer ignorance. (8) The emerging field of "behavioral public choice" draws attention to that possibility. (9) Consider the problem of behavioral bureaucrats: public officials who are not only adversely affected by the standard behavioral biases (such as present bias and availability bias) but also subjected to the pressure imposed by well-organized private groups with a significant stake in the outcome. (10) If behavioral bureaucrats suffer from the knowledge problem, it is all the more important to constrain them.

   It might also be objected that on grounds of both welfare and autonomy, active choosing is desirable even if people have a tendency to err. (11) People can learn from their own mistakes, and that might be quite important. On this view, people should be asked or allowed to choose, whether or not they would choose rightly. For all sides, the opposition between paternalism and active choosing seems stark and plain, and indeed it helps to define all of the existing divisions.

   My central goal here is to unsettle that opposition and to suggest that it is often illusory. The central reason is that people often choose not to choose, (12) and forcing them to choose is a kind of tax. In many contexts, insisting on active choosing, or forcing people to choose, is a form of paternalism, not an alternative to it. Under imaginable assumptions, any effort to require active choosing easily fits within the standard definition of paternalism and runs afoul of the most conventional objections to paternalism. Many people believe, in many contexts, that choosing is burdensome and costly. Sometimes they choose not to choose explicitly (and indeed are willing to pay a considerable amount to people who will choose for them). They have actively chosen not to choose.

   Sometimes people have made no explicit choice; they have not actively chosen anything. But it is nonetheless reasonable to infer that in particular contexts, their preference is not to choose, and they would say so if they were asked. (Recall the case of the cab ride to the airport, or the interaction with a doctor or a lawyer.) They might fear that they will err. They might be busy and lack "bandwidth," (13) and so they have limited cognitive resources and do not want them to be taxed. They might want to focus on some concerns but not others; they might think that choosing would deny them that freedom. They might be aware of their own lack of information (14) or perhaps their own behavioral biases (such as unrealistic optimism (15)). They might find the underlying questions confusing, difficult, painful, and troublesome--empirically, morally, or otherwise. They might not enjoy choosing. They might not want to take responsibility for potentially bad outcomes for themselves (and at least indirectly for others). (16) They might anticipate their own regret and seek to avoid it. (17)

   But even when people prefer not to choose, many private and public institutions favor and promote active choosing on the ground that it is good for people to choose. They may have sufficient reasons for that belief. Sometimes active choosing is required as a way of overcoming a collective action problem (people cannot delegate the right to vote), but sometimes it is a means of protecting those who choose not to choose against their own mistake(s). The central idea is that people should be choosing whether or not they want to do so. An institution might think that choice-making builds some kind of muscle; it might think that it helps people to learn. To the extent that the institution's preference for choice-making overrides that of the chooser (who prefers not to choose), active choosing counts as paternalistic. It overrides people's own judgments about what is good or what best promotes welfare or freedom.

   To be sure, nanny states forbid choosing, but they also forbid the choice not to choose. Choice-promoting or choice-requiring paternalism might be attractive forms of paternalism, but neither is an oxymoron, and they are paternalistic nonetheless.

   If people are required to choose even when they would prefer not to do so, active choosing counts as a species of nonlibertarian paternalism in the sense that people's own choice is being rejected. We shall see that in many cases, those who favor active choosing are actually mandating it, and may therefore be overriding (on paternalistic grounds) people's choice not to choose. (18) When people prefer not to choose, required choosing is a form of coercion--though it may be a justified form, at least where active choosing does not impose high taxes, when it does not increase the likelihood and magnitude of errors, and when it is important to enable people to learn and to develop their own preferences. One strand of the liberal political tradition emphasizes the importance of self-development; forcing people to choose can be counted as perfectionist (in the liberal sense) and in a sense as unabashedly paternalistic. (19)

   If, by contrast, people are asked whether they want to choose and can opt out of active choosing (in favor of, say, a...