Behavioral Economics: A Shaky Ground for Nudges

Ten years after its first publication, the excitement about “Nudge: Improving decisions about health, wealth, and happiness” (2009) has not yet diminished. If at all, it has increased. Methodological and normative critiques continue to be published both in philosophical and economic journals (Heilmann, 2014). Nudge, by behavioural economist Thaler and legal scholar Sunstein, proposes an approach to policy making that has come to be known as libertarian paternalism. Libertarian paternalism, as Sunstein (2018) puts it, is a paternalism of means, rather than ends. The idea is that people suffer from a number of biases when making decisions. Hence, they often take a suboptimal route to reach their goals. Libertarian paternalism enables people to satisfy those goals by guiding them towards the optimal route. Just like a GPS, libertarian paternalism offers people the best means to reach the ends that they themselves set out to achieve (ibid). It increases people’s navigability by offering them the best path to follow in order to satisfy their goals. To argue for their thesis, Thaler & Sunstein (2009) draw heavily on the findings of behavioural economics and related work in psychology. However, is it really the case that these findings lend empirical and conceptual support to the assumptions on which Nudge is based? This is the question that I will engage with in this essay.