Requiring Active Choosing is a Form of Paternalism

Abstract

Many people insist on drawing a line between active choosing and paternalism, but that line is often illusory. Whenever private or public institutions override people’s desire not to choose, and insist on active choosing, they are likely to be behaving paternalistically, through a kind of choice-requiring paternalism. Active choosing can be seen as a form of libertarian paternalism if people are permitted to opt out of choosing in favor of a default (and in that sense not to choose). This is a distinctive approach – “simplified active choosing” – and in many contexts, it has considerable appeal. By contrast, active choosing is a form of nonlibertarian paternalism insofar as people are required to choose. These points have implications for a range of issues in law and policy, suggesting that those who favor active choosing, or insist on it, may well be overriding people’s preferences (for better or for worse).

Keywords: active choosing, default rules, paternalism, behavioral economics

JEL Classification: D02, D03, D73, D87, D91, K00, K20