The Pros And Cons Of Libertarian Paternalism

The decision making process includes cognitive processes that eventually lead to a choice in action while taking into consideration the alternative possibilities (Allen, Dorozenko, & Roberts, 2016). Not all choices have to lead to an action. The values and preferences of the person making the choice also comes into play when making the final decision. Problem-solving to obtain a certain goal or satisfactory by a solution is the main reason people go through the decision making process (Stefaniak, & Tracey, 2014). This process has many factors that end with one final result or solution. The decisions made can be rational or irrational and can be determined by explicit or tacit knowledge (Qingyao, Dongyu, & Weihua, 2016). Since the decision making process can be very difficult at time, psychologists have viewed the process in different perspectives to get a better understanding (Rossi, Picchi, Di Stefano, Marongiu, & Scarsini, 2015). The different perspectives include; psychological, cognitive, and normative or communicative rationality.

Daily economic activities have an important influence on personal financial planning. In our society, the forces of supply and demand play an important role in setting prices. Economics is the study of how wealth is created and distributed. By doing my research, I found that each economic situation would affect me at a personal level.

Conservatism as a Tension between Paternalism and Libertarianism There are many different strands of conservatism within the ideology, the most significant of which in modern terms are paternalism and libertarianism. This conflict can be illustrated by the rival traditions of one-nation conservatism and New Right, or in particular neoliberal, conservatism. The basic idea of paternalism is to have authority over people for their own good. Whereas continental conservatives in the nineteenth century opposed any change, an Anglo-American tradition began with Edmund Burke which was more cautious, modest and pragmatic - these type of conservatives were willing to ‘change in order to conserve’.

For the most part, our decision-making processes are either sub-conscious or made fairly quickly due to the nature of the decision before us. Most of us don't spend much time deciding what to have for lunch, what to wear, or what to watch on television. For other, more complex decisions, we need to spend more time and analyze the elements of the decision and potential consequences. To assist with this, many people employ the use of a decision-making model. Utilizing a

Kahneman’s article is an analysis of intuitive thinking and how it guides our decision-making. Although primarily aimed at the field of psychology, it is an interdisciplinary article with applications in economic theorising. Kahneman attempts to differentiate between two systems of thought, one of intuition (system 1) and one of reasoning (system 2), and argues that many judgements and choices are made intuitively, rather than with reason (a slower and more deliberate process). Intuitive decision making, which encompasses heuristics, although generally more efficient and rapid, makes the agent potentially subject to errors due to framing effects or violations of dominance. The analysis of the studies and theoretical situations also provides criticism of the commonly held model of the rational agent within economics. The article also further conceptualises Kahneman’s theory, the Prospect Theory (Kahneman & Tversky, 1979), which has descriptive applications of people’s choice in decision-making situations involving risk and known probability of outcomes. These situations are typically unexplained by the more normative rational agent model.

Understanding behavioral economics will also help in making critical decisions like how much a person need to be saving, how much effort we need to put in our works and where we will choose to live in future.

In today’s economy, decision-making skills vary for each household; however, the bottom-line goal for every individual is to get the most for their money. In order to do this, there are 4 principles of individual decision-making: facing trade-offs, evaluating what one is giving up to obtain their goal, thinking at the margin, and responding to incentives.

Economists have often modelled human decision makers as completely rational. According to this model, rational people know their own preferences, gather and accurately process all relevant information, and then make rational choices that advance their own interests. However, Herbert Simon won a Nobel Prize in economics by pointing out that people are rational, but only boundedly so in that they seldom gather all available information, they often do not accurately process the information

Libertarian paternalism, a mix of libertarianism and paternalism, is an ideology by Sunstein and Thaler. It holds that humans should have free will and should be able to have the freedom to decide what to do with their own body and life, but with some government interference. This ideology does not take away any choices but it does basically manipulate people into making choices that are good for them; therefore a libertarian paternalist would agree with the decriminalization of drugs and prostitution but would nudge people away from it. Libertarianism is the belief that someone 's liberty should not be restricted even if it is for their own good. Libertarians would agree with the legalization of drugs and prostitution even though they may harm people. The opposing view of libertarianism is paternalism which is the belief that it is justified to restrict someone’s liberty for their own good. Gerald Dworkin (1968), a pro-paternalistic philosopher, believes that coercing someone to do something is “justified by the reasons referring exclusively to the welfare, good, happiness, needs, interests or values of the person being coerced” (p. 108). This is pure paternalism. On the other hand, impure paternalism is restricting the freedom of people who do not benefit from it, such as imposing laws that regulate the sale of cigarettes. Paternalism does not allow for the legalization of drugs or prostitution. In this paper, I will argue that the state may legitimately interfere with our

     John Stuart Mill and Gerald Dworkin have distinctly opposing views on legal paternalism in that Mill is adamantly against any form of paternalism, whereas Dworkin believes that there do exist circumstances in which paternalism is justified. Both agree that paternalism is justified when the well being of another person is violated or put at risk. Mill takes on a utilitarian argument, explaining that allowing an individual to exercise his freedom of free choice is more beneficial to society than deciding for him what is in his best interests. Dworkin, on the other hand, feels that certain cases require the intervention of either society as a whole or its individual members. He breaks

Is the State justified in restricting individuals’ access to drugs in order to prevent them from harming themselves?

The future is uncertain, as such conventional wisdom dictates that governments must intervene in the economy to help enhance growth and ensure stability. However, is too much intervention a bad thing? There are many reasons why it is so but one such reason is that in an economy where there is excessive government intervention and ownership such as in the Soviet Union, there was a lack of risk and subsequently lack of innovation as rather than satisfying customers the concern of a producer in the system was to satisfy the state. The lack of a reward for working harder, due to all businesses being owned by the state reduces incentive to produce or innovate and this leads to inefficient outcomes in an economy. This is a contrast to a capitalist society where innovation and hard work can lead to personnel gain in the form of money. Price ceiling and price floors are price control mechanisms that are used to, respectively set a maximum price, and a minimum price. One such problem as a result of implementing these is that they will artificially cause a shortage or surplus, respectively, of the good or service due to affecting supply and demand. This prevents the good/services to be at the equilibrium price, which is where economic outcomes would be most efficient. So should governments intervene? Regardless of the aforementioned downsides this has always been a topic of debate between Keynesian economists and classical economists, but a widely accepted consensus is that some level

Many methods have been developed to simplify the decision making process. In this paper, the rational model of decision making will be discussed first. Then, some of the factors that cause deviation in the rational

My independent research in the field started with my curious interest in the processes of how decisions made by individuals and governments, what are the main factors encouraged them to choose particular decision over other options and the outcomes of those decisions. Then, I started to read theories of great Economists, such as, Keynes, Freidman , Devenport, Kinnerly and Mason who wrote on decision-making and the ability of individual to interpret the information. Additionally, there were theories by De Bondt , Clark , Tversky and Kehnman who argued that human psychology is interconnected with economics which cannot be ignored. Learning those theories and comparing them with the real life happenings, my enthusiasm to get deeper insights of economics increased. Encouraged by this, I have compiled

Effective decision-making is very important on how probability can be applied therefore effective decision-making must be rational. As mentioned before, people who are deciding rationally are attempting to reach goals in a systematic way. They make sure