Sunday, February 28, 2021

What Motivates Paternalism? By Ambuehl, ,Bernheim and Ockenfels in the AER

 I have long been interested in repugnant transactions, which some people would like to engage in and others, not themselves involved in the transaction ('third parties') think should be forbidden.  That's a big class of phenomena (even when we exclude transactions that third parties object to because they might suffer negative externalities). In some cases (e.g. opposition to same sex marriage) there seems to be a lack of empathy with those who want or need to transact in ways that third parties object to. In other cases (e.g. opposition to surrogacy) there often seems to be a desire to protect vulnerable parties  (e.g. potential surrogate mothers) from entering into a transaction that the objecting third parties believe would harm the surrogates.  This latter kind of objection often falls under the label "paternalism."

Here's a paper in the latest AER that explores and finds paternalism in the lab.

What Motivates Paternalism? An Experimental Study By Sandro Ambuehl, B. Douglas Bernheim, and Axel Ockenfels, American Economic Review  March 2021, 111(3): 787–830, https://doi.org/10.1257/aer.20191039

Abstract: "We study experimentally when, why, and how people intervene in others' choices. Choice Architects (CAs) construct opportunity sets containing bundles of time-indexed payments for Choosers. CAs frequently prevent impatient choices despite opportunities to provide advice, believing Choosers benefit. They violate common behavioral welfare criteria by removing impatient options even when all pay-offs are delayed. CAs intervene not by removing options they wish they could resist when choosing for themselves (mistakes-projective paternalism), but rather as if they seek to align others' choices with their own aspirations (ideals-projective paternalism). Laboratory choices predict subjects' support for actual paternalistic policies. "

No comments: