Wednesday, October 6, 2010

Is "Nudging" Nothing Else than Newspeak for "Influencing"?

It's very fashionable these days to talk about "nudging," a concept promoted most famously by Richard Thaler, an eternal and strong candidate for the Nobel Prize in Economics. But isn't "nudging" maybe nothing else than "influencing", fancifully disguised as a tool to be used solely for "good," in an example of age-old newspeak? "Nudging," by the way, has also been called, in a way that looks to me suspiciously "newspeakish," "libertarian paternalism" or "choice architecture."

This post about "Nazi nudging" by Marginal Revolution's Alex Tabarrok, and the discussion that follows in its comments section, is quite elucidative. Thaler himself said this about "nudging":

BuzzFlash: Nudges by your definition are well intentioned. Benevolent nudgers “are self-consciously attempting to move people in directions that will make their lives better.” Can you contrast that to a more nefarious choice architecture?

Richard H. Thaler: Nudgers CAN be well-intentioned but can also be self-interested. We are being nudged all the time by marketers, religions, spouses, etc. Sunstein and I did not invent nudging! Our goal is to give benevolent nudgers an instruction manual. The evil nudgers have already mastered most of these tools, alas.

It looks to me like there's a large component of wishful thinking and not much public choice theory substance in the way Thaler looks at his own "creation."

PS: I'd like to add the following.

It's not only that "nudging" may lack originality and economic soundness as a concept. There's also a potentially very significant moral issue behind Thaler's interpretation of its own ideas. I'll explain with an example: Coke is not telling you that "it's doing marketing for your own good" when it tries to convince you to drink more Coke. Any adult in control of his or her mental faculties can understand Coke's motivations, and can choose to let himself or herself "go with them" or "avoid them."

Moreover, it would be absolutely disingenuous if Coke would tell you otherwise. Thaler's definition of "evil nudging" therefore should, in most circumstances, be easily recognized as "influencing" by mentally capable people. On the other hand, trying to pass "influencing" by governments, or by anyone in a position of authority, as "well-intentioned nudging" is to me the same as trying to hide the fact that the authority is just using its powers to influence people's decisions and choices according to what the authority believes to be right or according to the self-interested motivations of the authority.

What I mean is that, once the newspeak is peeled off, "nudging" looks a lot like the defense of the right of people in positions of authority to influence other people's choices. If this is the case, then why not just call a spade a spade?

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