Deceptive Choice Architecture and Behavioural Audits

Abstract

Regulators are increasingly concerned about deceptive choice architecture in private markets. Such deceptive practices include behavioural sludge and dark patterns. Fostering a regulatory environment which reduces the harms caused by these behavioural designs, while safeguarding the benefits of well-meaning behavioural insights, is essential. I argue a principles-based regulatory approach will be key to provide flexibility given subjective experiences of choice architecture. Furthermore, I suggest behavioural audits could support a positive regulatory environment, maintaining the benefits of behavioural insights while safeguarding citizens and consumers. Some initial proposals for such audits are offered.

Keywords: Choice Architecture, Regulation, Principles-Based Regulation, Behavioural Audits, AI

JEL Classification: M38, M48