The limits to libertarian paternalism: two new critiques, and seven best practice imperatives

Abstract

Behavioural economists argue that humans are predictably irrational in various ways, as a result of which there appears to be a role for public policy to improve their decision-making. We offer a sympathetic critique of this so-called ‘libertarian paternalist’ approach. As well as reviewing existing critiques, we present two new arguments. First, we question the use of libertarian paternalism in situations where the social good is invoked to justify policies that are not beneficial to the individuals directly affected. Second, we highlight the potentially adverse consequences of poorly targeted libertarian paternalist techniques. The penultimate section then brings together the existing critiques and the new arguments to offer seven best practice imperatives for the reflective application of these powerful, but easily misused, tools of government. We conclude with some brief reflections on what freedom might mean in the context of libertarian paternalist governance.