Rizzo and Whitman on Paternalist Slopes

Josh Wright —  2 February 2007

Libertarian paternalism, behavioral law and economics, and “soft” paternalism are topics of discussion here on TOTM from time to time (see, e.g. here, here, and here).  Two very good economists who think about these problems quite a bit, Mario Rizzo (NYU) and Glen Whitman (Agoraphilia, CSUN), have posted their paper “Paternalist Slopes.”  I had the pleasure of meeting Rizzo and Whitman at the New York University Journal of Law and Liberty Symposium on Behavioral Economics and Classical Liberalism where they were discussing this paper.  It is an excellent read for those interested in these issues.
Here’s the abstract:

A growing literature in law and public policy harnesses research in behavioral economics to justify a new form of paternalism. Contributors to this literature typically emphasize the modest, non-intrusive character of their proposals. A distinct literature in law and public policy analyzes the validity of “slippery slope” arguments. Contributors to this literature have identified various mechanisms and processes by which slippery slopes operate, as well as the circumstances in which the threat of such slopes is greatest.

The present article sits at the nexus of the new paternalist literature and the slippery slopes literature. We argue that the new paternalism exhibits many characteristics identified by the slopes literature as conducive to slippery slopes. Specifically, the new paternalism exhibits considerable theoretical and empirical vagueness, making it vulnerable to slopes resulting from altered economic incentives, enforcement needs, deference to perceived authority, bias toward simple principles, and reframing of the status quo. These slope processes are especially likely when decisionmakers are subject to cognitive biases – as the new paternalists insist they are. Consequently, soft paternalism can pave the way for harder paternalism. We conclude that policymaking based on new paternalist reasoning should be considered with greater trepidation than its advocates have suggested.

Very soon I will be posting my own paper, Behavioral Law and Economics, Paternalism, and Consumer Contracts: An Empirical Perspective, from the Symposium on similar issues.