Discover more from Overcoming Bias
While paternalism is about bias, it need not be about irrational bias. In a 2003 Journal of Public Economics paper, I modeled product bans and warnings directed at completely-rational consumers, and chosen by a better-informed completely-rational regulator who only cares about economic welfare. I found:
Even ideal regulators want to lie about product quality, to correct for other market failures.
Even a small temptation to lie makes consumers disbelieve most of what regulators say.
Regulators who can ban sometimes do, as consumers won’t believe severe warnings.
Consumers believe more severe warnings from regulators who can only warn.
When regulators prefer to talk up quality (e.g., in health, school, investing), both regulators and consumers are better off if regulators cannot ban.
Yes, this model may be less relevant if irrational biases are central to paternalism. But it at least gives us a concrete reference point. Weather permitting, David Balan and I debate paternalism today.
Rational Agent Paternalism
but say we do it to protect the drinker.
We do? Maybe, I'm not sure. I am sure that cocaine and marijuana were originally banned in the name of violence. I am pretty sure that Prohibition was brought about by women concerned about their husbands' drinking.
Has something changed in the way we talk about drugs? or just government?
Daniel, Bryan Caplan notes that parents tell kids to go to bed at a certain time because that makes life easier for the parents, even though parents talk as if they were doing it for the kids benefit. Similarly, alcohol mostly benefits those who drink it, but often at the expense of others around them, and so we limit alcohol but say we do it to protect the drinker.