Welfare justifications and responsibility in political decision making - The case of Nudging*

Abstract

ABSTRACT Nudging, i.e. the framing of decision environments to exploit known behavioral biases in order to induce certain outcomes, has received considerable attention as a potential policy tool in recent years. Motivated as preserving freedom of choice while making people better off according to their own judgment, nudging seemingly comes at fairly little responsibility for the nudger, i.e. policy makers, regarding eventual behavior. We argue that this is misleading, that nudging is normatively charged as other welfare-based policy interventions and, hence, does not free policy makes from normative choices. Sidestepping discussions about welfare measurement, we presume there is an entity which comprehensively captures individual well-being as intended, referred to as Welfare*, and highlight four aspects of it which we argue require normative/subjective decisions: (a) the inference from the empirical to what is desirable, (b) the choice of perspective necessary to empirically capture Welfare*, (c) the forecast about the evolution of future behavior, and (d) external factors affecting the agent devising the nudge. Thus, while nudging may well be good and helpful as a policy tool, we argue that there is little reason to think of it as being normatively more innocuous for policy makers than other welfare-based policy instruments.