Like most fashionable ideas, the theory of ‘nudging’, also known as ‘libertarian paternalism’, has spawned a backlash. Among the most prominent recent criticism is Jeremy Waldron’s claim that the use of nudging by governments risks failing to account for the dignity of their citizens. Waldron’s view is that it is bad to exploit people’s cognitive biases to get them to make ‘better’ – that is, welfare improving – choices, as libertarian paternalists suggest. On his view, such actions imply that that “my capacities for thought and for figuring things out are not really being taken seriously for what they are: a part of my self”. Consequently, “Nudging takes advantage of my deficiencies in the way one indulges a child” – that is, in a way that is undignified for a competent adult.
One response to this line of argument is to accept the claim that nudging involves some loss of dignity, but to insist that it is still worthwhile because of the other important values it promotes. Thus automatically enrolling people in pension schemes might undermine their dignity, but it is worth it because it averts the massive loss of welfare involved in people having too little savings in their retirement.
We can press this argument by asking why, if nudging is so undignified, it is an acceptable practice among private businesses but not government. As Waldron acknowledges: “Every day we are bombarded with offers whose choice architecture is manipulated, not necessarily in our favor. The latest deal from the phone company is designed to bamboozle us, and we may well want such blandishments regulated”. ‘Nudging’, though it may not be explicitly labelled as such, is common in most consumer markets. To take a couple of common examples – the arrangement of shop shelves, or the construction of restaurant menus usually involve some manipulation of the consumer’s biases. If Waldron is correct, we are constantly being treated in an undignified manner by the businesses we deal with. But though Waldron raises the possibility of regulation of the worst excesses of private sector nudging, genuinely stamping it out would involve intolerable government intrusion, perhaps to the point of making private industry impossible. Most people would see that as undesirable – and so the obvious conclusion is that the goods secured by maintaining private businesses outweigh the costs to dignity. But if at least some private sector nudging is acceptable, it is surely legitimate for government bureaucrats to ask why they shouldn’t be allowed to use the same techniques, for more benign purposes.
However, I am not sure that Waldron’s claim about dignity is correct – certainly in all instances of nudging. In particular, I think that making use of someone’s ‘faulty’ heuristics is consistent with respecting their dignity.
I think much of Waldron’s objection comes from a particular framing of the mechanics of nudging. For him, there are two “dramatis personae”:
‘Dupes’ (my term, not his): “ordinary individuals with their heuristics, their intuitions, and their rules of thumb, with their laziness, their impulses, and their myopia”
‘Government House Bureaucrats’: “the law professors and the behavioral economists who (a) understand human choosing and its foibles much better than members of the first group and (b) are in a position to design and manipulate the architecture of the choices that face ordinary folk”
Seen in this light, it is obvious why Waldron comes to the conclusions he does about nudging and dignity – government house bureaucrats are all-powerful and all-arrogant, the dupes are pitiable fools to be manipulated.
However, the notion of heuristics is important, because people who use heuristics are certainly not dupes. Heuristics are not the preserve of the stupid and irrational, Rather, heuristics are entirely sensible and efficient simplifying principles, which are right most of the time, but which occasionally go awry. Waldron complains that “Nudging doesn’t teach me not to use inappropriate heuristics or to abandon irrational intuitions or outdated rules of thumb”. But the point is that abandoning the heuristic wouldn’t be an ennobling, enlightening experience. It would involve taking away one of the important cognitive tools that we need to navigate a complicated world. Heuristics are there for a reason, and the reason is that we do not have the time and mental resources to fully immerse ourselves in every decision we make – as a result, we need short cuts.
Once we see this point, it is possible to view nudging bureaucrats not as puppeteers, pulling the strings of citizens, but rather as a collective resource for easing our cognitive burden. It would be great if people were taught to think actively, as Waldron suggests, but this involves a cost to the citizens who need to make time and mental space for such considerations. Nudging offers a way to outsource matters that are particularly difficult, inconvenient or technical to a team of experts, whose job is to look out for us.
In the abstract this sounds a bit lazy, or perhaps sinister. However, an analogy might make it clearer that this is already how we use some government agencies. Take, for example, government agencies involved in ensuring food quality. In principle, these involve a restriction of consumer choice and an abdication of consumer responsibility. There are probably diehard libertarians who would argue that consumers ought to carefully read the labels of everything they purchase, so that those who were willing to pay less for riskier food could do so. But most people agree that this would be exhausting and difficult, and so it is better for the government to pay specialists to do it for them.
The use of specialists or experts to guide decisions that we do not believe are worth the time and effort too investigate fully does not seem undignified to me. Consequently, I do not believe there is anything inherently undignified about being ‘nudged’.