scholarly journals Hayekian behavioral economics

2021 ◽  
pp. 1-19
Author(s):  
Cass R. Sunstein
Keyword(s):  
Behavioral Economics ◽  
Fuel Economy ◽  
John Stuart Mill ◽  
Price System ◽  
Public Institutions ◽  
Limited Attention ◽  
Unrealistic Optimism ◽  
Freedom Of Choice ◽  
Present Bias ◽  
Favorable Conditions

Abstract One of Friedrich Hayek's most important arguments pointed to the epistemic advantages of the price system, regarded as an institution. As Hayek showed, the price system incorporates the information held by numerous, dispersed people. Like John Stuart Mill, Hayek also offered an epistemic argument on behalf of freedom of choice. A contemporary challenge to that epistemic argument comes from behavioral economics, which has uncovered an assortment of reasons why choosers err, and also pointed to possible distortions in the price system. But, even if those findings are accepted, what should public institutions do? How should they proceed? A neo-Hayekian approach would seek to reduce the knowledge problem by asking what individual choosers actually do under epistemically favorable conditions. In practice, that question can be disciplined by asking five subsidiary questions: (1) What do consistent choosers, unaffected by self-evidently irrelevant factors, end up choosing? (2) What do informed choosers choose? (3) What do active choosers choose? (4) When people are free of behavioral biases, including (say) present bias or unrealistic optimism, what do they choose? (5) What do people choose when their viewscreen is broad, and they do not suffer from limited attention? These questions are illustrated with reference to the intense controversy over fuel economy standards.

scholarly journals ‘Come on, man!’ On errors, choice, and Hayekian behavioral economics

2021 ◽  
pp. 1-7
Author(s):  
Cass R. Sunstein
Keyword(s):  
Behavioral Economics ◽  
Present Author ◽  
Narrow Range ◽  
Price System ◽  
Behavioral Biases ◽  
Present Essay ◽  
Favorable Conditions ◽  
Individual Choices

Abstract With respect to the views of dead thinkers, answers to many particular questions are often interpretive in Ronald Dworkin's sense. Such answers must attempt (1) to fit the materials to be interpreted and (2) to justify them, that is, to put them in the best constructive light. What looks like (1), or what purports to be (1), is often (2). That is, when a follower of Kant urges that ‘Kant would say x’, or that ‘Kantianism entails y’, the goal is to make the best constructive sense of Kant and Kantianism, not merely to adhere to something that Kant actually said. An approach to behavioral economics cannot claim to be Hayekian if it is rooted in enthusiasm for the abilities of planners to set prices and quantities, or if it sees the price system as a jumble of mistakes and errors. But within a not-so-narrow range, a variety of freedom-preserving approaches, alert to the epistemic limits of planners, can fairly claim to be Hayekian. Hayekian behavioral economics, I suggest, is an approach that (1) recognizes the importance and pervasiveness of individual errors, (2) emphasizes the epistemic limits of planners, (3) builds on individual choices rather than planner preferences, and (4) gives authority to choices made under epistemically favorable conditions, in which informational deficits and behavioral biases are least likely to be at work. The key step, of course, is (4). If it is properly elaborated, the resulting approach deserves respect. It is worthy of serious consideration, even if some of us, including the present author, would not entirely embrace it. In defending that proposition, the present essay responds to some critical remarks on behaviorally informed policy, including the resort to ‘explainawaytions’ (Matthew Rabin's term) for behavioral findings.

scholarly journals How Hayekian is Sunstein's behavioral economics?

2021 ◽  
pp. 1-10
Author(s):  
Robert Sugden
Keyword(s):  
Behavioral Economics ◽  
Fuel Economy ◽  
Behavioural Economics ◽  
Carbon Taxes ◽  
Normative Economics

Abstract I comment on Sunstein's paper proposing ‘Hayekian behavioural economics’. In essence, Sunstein is merely renaming a familiar approach to normative economics, initiated in Sunstein and Thaler's seminal 2003 paper. I argue that this approach cannot fairly be described as in the spirit of Hayek's work. Sunstein's approach is based on a ‘constructivist’ conception of rationality that Hayek consistently criticized. Although both Hayek and Sunstein address ‘knowledge problems’, the two problems are fundamentally different. I develop what I claim are truly Hayekian critiques of Sunstein's claim that fuel economy mandates can be more Hayekian than carbon taxes.

scholarly journals Behavioral Economics Incentives to Support HIV Treatment Adherence (BEST): Protocol for a randomized controlled trial in Uganda

Trials ◽  
2020 ◽  
Vol 21 (1) ◽  
Author(s):  
Sebastian Linnemayr ◽  
Chad Stecher ◽  
Uzaib Saya ◽  
Sarah MacCarthy ◽  
Zachary Wagner ◽  
...  
Keyword(s):  
Randomized Controlled Trial ◽  
Viral Load ◽  
Behavioral Economics ◽  
Viral Suppression ◽  
Controlled Trial ◽  
Hiv Positive ◽  
Art Adherence ◽  
Viral Loads ◽  
Present Bias ◽  
Randomized Controlled

Abstract Background Many HIV-positive patients do not appropriately adhere to their antiretroviral medication (ART). This leads to higher viral loads and greater probability of HIV transmission. Present bias—a tendency to give in to short-term temptations at the expense of long-term outcomes—is a potential driver of low adherence. In this study we test a novel intervention rooted in behavioral economics that is designed to overcome present bias and increase ART adherence. Methods/design We will enroll 330 HIV-positive patients at Mildmay Hospital in Kampala, Uganda, into a 2-year randomized controlled trial. Participants will be randomized to one of three groups. The first intervention group (T1, n = 110) will be eligible for small lottery prizes based on timely clinic visits and demonstration of viral suppression. Group 2 (T2, n = 110) will be eligible for the same lottery prizes conditional on high adherence measured by a medication event management system (MEMS) cap. The control group (n = 110) will receive the usual standard of care. Adherence will be measured continuously throughout the intervention period and for 12 months post-intervention to evaluate effect persistence. Surveys will be conducted at baseline and then every 6 months. Viral loads will be measured annually. Primary outcomes are whether the viral load is detectable and MEMS-measured adherence. Secondary outcomes are the log-transformed viral load as a continuous measure and a binary measure for whether the person took at least 90% of their ART pills. Discussion Our study is one of the first to investigate the effectiveness of lottery incentives for improving ART adherence, and in addition, it compares the relative efficacy of using electronically measured adherence versus viral load to determine lottery eligibility. MEMS caps are relatively costly, whereas viral load testing is now part of routine clinical care in Uganda. BEST will test whether directly incentivizing viral suppression (which can be implemented using readily available clinic data) is as effective as incentivizing electronically measured adherence. Cost-effectiveness analyses of the two implementation modes will also be performed. Trial registration ClinicalTrials.gov, NCT03494777. Registered on 11 April 2018.

Mill and Millians on Liberty and Moral Character

1985 ◽  
Vol 47 (1) ◽  
pp. 3-26 ◽  
Author(s):  
Harry M. Clor
Keyword(s):  
Character Development ◽  
Personal Autonomy ◽  
Moral Character ◽  
John Stuart Mill ◽  
Individual Autonomy ◽  
Freedom Of Choice ◽  
Personal Liberty ◽  
Human Excellence

This essay critically explores the efforts of John Stuart Mill and contemporary Millian scholarship to provide a utilitarian justification for a categorical principle of personal liberty. What is distinctive about Mill's argument is its pronounced emphasis upon character development as an essential constituent of happiness; the heart of the argument is that freedom of choice promotes a kind of elevated or worthy human character upon which happiness ultimately depends. Hence, society must be prevented from imposing any conventional or customary morality which would restrict individual autonomy. This case for the sovereignty of personal autonomy is infected with a number of difficulties and ambiguities. Central among these are weighty problems associated with Mill's crucial concept of individuality and its relation to human excellence or nobility of character. The refinements upon Millian doctrine introduced by his current supporters do not, and cannot, resolve its inherent ambiguities.

scholarly journals Digital Addiction in Teenagers: Tackling it With an App Based on Behavioral Economics

2021 ◽  
Vol 10 (1) ◽  
Author(s):  
Samantha Kitchener ◽  
Zoe T
Keyword(s):  
Behavioral Economics ◽  
Goal Setting ◽  
Screen Time ◽  
Hyperbolic Discounting ◽  
Rational Decision ◽  
Negative Consequences ◽  
Present Bias ◽  
Irrational Behavior ◽  
Digital Addiction

In recent years, smartphone usage has increased rapidly, especially in teenagers. The excessive screen time can lead to digital addiction which means people use technology to a point where they cannot stop, even though they recognize the negative consequences associated with it. In behavioral economics, there are two ways of classifying all decisions we make in life: rational and irrational. A rational decision would be one that gives us the most utility or satisfaction. Because humans are imperfect, we constantly make irrational decisions, such as using our phone too much even though we know that it is not the best use of our time. There is an explanation in behavioral economics behind this though. There are theories such as hyperbolic discounting and present bias that say humans value things more that are in the present time. I am recommending the use of an app in order to lower teens' screen time. This app would have numerous features such as goal setting, points/rewards, and a leaderboard that directly counteract this irrational behavior.

scholarly journals Nudging and Boosting: Steering or Empowering Good Decisions

2017 ◽  
Vol 12 (6) ◽  
pp. 973-986 ◽  
Author(s):  
Ralph Hertwig ◽  
Till Grüne-Yanoff
Keyword(s):  
Behavioral Economics ◽  
Behavioral Science ◽  
Cognitive Architecture ◽  
Freedom Of Choice ◽  
Policy Makers ◽  
Coercive Measures ◽  
Potential Value ◽  
Policy Interventions ◽  
Causal Pathways ◽  
Human Cognitive Architecture

In recent years, policy makers worldwide have begun to acknowledge the potential value of insights from psychology and behavioral economics into how people make decisions. These insights can inform the design of nonregulatory and nonmonetary policy interventions—as well as more traditional fiscal and coercive measures. To date, much of the discussion of behaviorally informed approaches has emphasized “nudges,” that is, interventions designed to steer people in a particular direction while preserving their freedom of choice. Yet behavioral science also provides support for a distinct kind of nonfiscal and noncoercive intervention, namely, “boosts.” The objective of boosts is to foster people’s competence to make their own choices—that is, to exercise their own agency. Building on this distinction, we further elaborate on how boosts are conceptually distinct from nudges: The two kinds of interventions differ with respect to (a) their immediate intervention targets, (b) their roots in different research programs, (c) the causal pathways through which they affect behavior, (d) their assumptions about human cognitive architecture, (e) the reversibility of their effects, (f) their programmatic ambitions, and (g) their normative implications. We discuss each of these dimensions, provide an initial taxonomy of boosts, and address some possible misconceptions.

scholarly journals Freedom of choice: John Stuart Mill and the tree of life

SERIEs ◽  
2011 ◽  
Vol 3 (1-2) ◽  
pp. 209-226
Author(s):  
Jorge Alcalde-Unzu ◽  
Miguel A. Ballester ◽  
Jorge Nieto
Keyword(s):  
John Stuart Mill ◽  
Tree Of Life ◽  
Freedom Of Choice

scholarly journals In Honor of Matthew Rabin: Winner of the John Bates Clark Medal

2003 ◽  
Vol 17 (3) ◽  
pp. 159-176 ◽  
Author(s):  
Colin Camerer ◽  
Richard H Thaler
Keyword(s):  
Behavioral Economics ◽  
Bayesian Models ◽  
Small Samples ◽  
Time Discounting ◽  
Seminal Paper ◽  
Present Bias ◽  
Judgment Biases ◽  
The Future ◽  
Hard Problems ◽  
Sin Taxes

Matthew Rabin's Clark medal honors his abilities to digest huge amounts of nuanced psychology, create simple models capturing that psychology, and do behavioral economics with those models. After warming up by solving hard problems in modeling pre-game communication, his behavioral career began with a seminal paper on reciprocity. He also created models of “present-bias” in time discounting, and derived some surprises from them, and implications (e.g., deadlinesetting and sin taxes). Matthew has also studied quasi-Bayesian models of judgment biases (confirmation and overgeneralization from small samples), overprojection of current feelings into the future, and how moral rules differ from moral tastes.

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