That’s not a crazy hypothesis. But the MoH commissioned stuff on alcohol didn’t feed directly into any RIS – it hit the LC’s review, and maybe they’d intended that it be around to justify stuff that would come post LC, but it’s awfully hard to read that paper and reckon that anybody at Treasury looking at the adequacy of an RIS would find it fit for purpose. The main point of it seemed instead to be the 5 second soundbite on Radio NZ on how horrible drinkers are in costing everybody else money, with the subsequent benefit of misleading Sir Geoffrey Palmer. 

My hypothesis, that I still have to figure out a way of testing, is that these reports push the median voter, on dimensions where the median voter has weak preferences, to support greater paternalism because the issue framing flips from “other people doing silly things” to “other people doing silly things that cost me money”. 

Why would anybody bother commissioning dodgy social cost studies unless they helped sway public opinion to justify policy?

Because of the move towards evidence-based policy in the public sector, as demonstrated by the RIA requirements. If you check out the literature on CBA for policy development (Robert Hahn and Claudio Radaelli do a lot of work in the field) they struggle to find any measurable effect on policy. There’s still a strong belief that it’s because the processes and expertise aren’t in place, rather than because it’s inherently unworkable, though.

Why would anybody bother commissioning dodgy social cost studies unless they helped sway public opinion to justify policy?

Agree that opt-out Kiwisaver is actually LP. Mandatory precommitment cards aren’t – everybody has to go through the hassle of getting one, no opt-out [see the Australian policy debates].

Look up the UK Nudge Unit sometime. Thaler was advisor there…. 

My feeling is that intervention to change the elements of the choice set steps outside the bounds of a nudge. It may be that many people who favour LP would like interventions that are more heavy-handed, but I think it’s hard to then call it libertarian in any sense.

Changing defaults seems fairly uncontroversial, but the difficult bit arises if you consider any intervention that overcomes a behavioural bias to fall within the ambit of LP. That’s when smoking taxes to correct internalities get brought up, which obviously have large costs from heterogeneity of consumers in addition to any benefits from precommitment. Since it’s unlikely to be optimal from any single person’s point of view it’s harder to justify. Eric may well argue that all such schemes are advanced under the same umbrella but that conceals a lot of variation in the classes of regulation that are proposed.

Bad social cost studies make folks think more things are bad for them through their pocketbook than is really the case

That’s possible, but I’d like to see evidence of it before being sure. I don’t know how much weight anyone really gives to the numbers that economists tout. Most research into policy development processes finds that the numbers are used to validate policies that would hvae been enacted regardless.

Can think of a fair bit of new paternalism couched as LP: precommitment cards for gamblers in Oz; all the soda nonsense; default opt-in Kiwisaver

Are precommitment cards and opt-in Kiwisaver not LP? I’m not familiar with the details so perhaps they’re not. I’m not really aware of any policy analyses that pay attention to the paternalistic nature of the proposed intervention. If they use LP terminology then I doubt it’s intentional except insofar as they try to minimise the perceived intrusion on people’s lives to gain acceptance of their proposal. I’d be really surprised if Thaler and Sunstein’s article had a measurable impact on policy development, as opposed to policy commentary!

Bad social cost studies make folks think more things are bad for them through their pocketbook than is really the case; libertarian paternalism makes paternalism seem cheaper than it really is. Both work to increase the effective demand for paternalistic policy. 

Agreed that LP can be used to scale back from hard paternalism to weak paternalism. Any examples of it ever happening anywhere? Can think of a fair bit of new paternalism couched as LP: precommitment cards for gamblers in Oz; all the soda nonsense; default opt-in Kiwisaver; some even push fat taxes as being nudges. Can’t think of any existing bit of paternalism that has been replaced by soft paternalism. 

I think your starting point is wrong: people intuitively want to regulate things that they view as ‘bad’ and their default is to ban them or something close. If they’re aware of LP then they might consider more liberty-preserving measures than they otherwise would. I think LP is unlikely to result in more regulation than would otherwise have existed, although it might moderate the mechanisms that are used.

Similarly, I doubt that the way externalities are taught makes much difference to the things that are regulated. Poor economics may provide a useful veneer of authority to regulations, but the desire for them is based on people’s pre-existing value judgments. If you look at the example of regulatory CBA (RIA in NZ), the required analyses have no discernable impact on the policies enacted, and that result holds across the Western world.