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Eur J Law Econ (2011) 31:321334
DOI 10.1007/s10657-010-9193-8
Vipin P. Veetil
Published online: 16 November 2010 Springer Science+Business Media, LLC 2010
Abstract Sunstein and Thalers proposal for libertarian paternalism in their paper titled Libertarian Paternalism is not an Oxymoron (LPNO from here on) is based on the contention that paternalism is sometimes (1) inevitable and (2) non coercive, and (3) that individuals do not always make rational decisions. The rst two contentions are untrue, and the question of whether individuals make rational decisions as judged by the axiomatic denition of neo-classical economic theory is vestigial to the ideas and policy prescriptions of classical liberal and libertarian political economy. The paper, fraught with denitional confusions and methodological difculties, is a superior example of how correct empirical observations and laudable advancements in identifying cognitive characteristics that may be relevant to economic analysis can lead to unsound theories due to methodological deciencies. Policy prescriptions in the long run must take an institutional form; the greatest deception of the paper lies in its omission of any discussion on such an institution, which, I believe by logical necessity would be a Platonist autocratic bureaucracy. A consistent application of libertarian paternalism is the road to serfdom.
Keyword Libertarian paternalism
JEL Classication K00
V. P. Veetil (&)
International PhD Program in Comparative Analysis of Institutions, Economics and Law, Collegio Carlo Alberto, Turin, Italye-mail: [email protected]
Libertarian paternalism is an oxymoron: an essay in defence of liberty
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322 Eur J Law Econ (2011) 31:321334
What is wrong with the discipline that is nowadays taught in most universities under the misleading label of economicsis their [teachers and authors]
ignorance of economics and with their inability to think logically.- Ludwig von Mises.
The Ultimate Foundations of Economic Science, 1962, p. 78.
1 Introduction
This paper is a critique of the paper titled Libertarian Paternalism is not an Oxymoron (LPNO) by Sunstein and Thaler. To that end, it compiles and develops libertarian arguments in defence of an anti-paternalistic position.
There are ve sections. Section I discusses the logical consequences of denitional deciencies in LPNO, proving that paternalism can never be non coercive or inevitable. Section 2 analyses the core of the LPNO argument that people are not always rational and thus some paternalism is necessary. Adam...