Richard H. Thaler, Cass R. Sunstein, Nudge: Improving decisions about health, wealth, and happiness

Thaler and Sunstein have written an important book. Though costumed in the guise of pop economics, complete with a cute logo—Nudge is, in fact, a manifesto for the new paternalism. Well written, witty to the point of being charming, consistently interesting, disarmingly self-referential, and loaded with crisp summaries of the psychology literature on human fallibility, Nudge’s dust jacket is justly festooned with blurbs from luminaries. But don’t be fooled. Thaler and Sunstein charm their readers, but they are after some very big game. This is a book that both measures the inroads psychology has made into contemporary economics, and argues a compelling brief for the new paternalism. We have ways, say Thaler and Sunstein, of making you happy. Thaler and Sunstein begin with ‘‘dogmatic anti-paternalists’’ in their sights. Economists, traditionally heavily represented among those opposed to paternalism, hold three mistaken beliefs about paternalism. They are: one, the belief that paternalism must be coercive, two, the belief that paternalism is avoidable, and, most important, three, the belief that people make choices that are better, by their own lights, than the choices that would be made for them by paternalists. Each of these traditional beliefs is a misconception or false, say the authors. Thaler and Sunstein regard three as simply false. In many situations, they say, paternalistic experts really do know better, and the proof is that those who have benefited from paternalistic expertise seem to concur. Traditional paternalism is coercive, so it is a stretch to label this belief a misconception, but never mind: Thaler and Sunstein want to rebrand the term, arguing that their ‘‘libertarian paternalism’’ is not an oxymoron. Nudgers, unlike bad old paternalists, help people without compulsion. A nudge steers the paternalized person, but always leaves open the option for the paternalized person to choose another course.