Escaping Paternalism Book Club: My Response to Questions
By Bryan Caplan
I’m also happy to take one last round of questions on Escaping Paternalism, and suspect that Rizzo and Whitman are up for an encore as well. If you have any remaining or Big Picture comments or questions, please share them in the comments for this post.
For now, here are my responses to some earlier questions.
Hazlitt takes an economic model of willpower. The will is simply that which we choose to do at one time and which has won out over competing desires. Given many short term desires may conflict with long term goals, the difficulty lies in keeping the long term vision/goal front of mind so that acting that way is not ‘dethroned’ by shorter term desires. So far, this seems like a fairly standard view. We aim at the best, but trip up on the way. This would be deemed irrational – we haven’t chosen correct means to achieve our ends.
But Hazlitt doesn’t call this irrational behaviour. It is not, as Rizzo and Whitman describe the behavioural economists’ view, a failure to choose effective means to achieve given, subjective ends. In Hazlitt’s view, it is that the long-term goal was poorly chosen. If, when the time comes to pay the price – to sacrifice by giving up something – and we choose not to give up that thing, we have chosen a goal that we were not willing and able to pay the price for. That is, we desired the long term goal, but did not demand it. Therefore, willpower is about what we demand – which is the product of how we value some things relative to others. Are we choosing goals in alignment with our values?
So, is a preference only useful in considering whether behaviour is rational or not if we are willing to pay the price for it, ie that we demand it? Are preferences assumed to be the things we demand, not desire? How does this idea relate to Rizzo and Whitman’s book? Thanks.
Hazlitt’s idea fits well with my view that most alleged “self-control problems” are driven by Social Desirability Bias. People say they want socially approved things, but their actions reveal what they actually want. When someone says, “Nothing means more to me than my family” after drinking away the rent money, the correct interpretation is that they prefer alcoholic beverages to their family’s well-being. Why claim otherwise? Because it sounds better. Yes, actions speak louder than words – but as long as some people fail to accept this truism, expect the flow of flowery verbiage to continue.
“I say the rational discount rate for utility is no time discounting at all.”
Isn’t that like ignoring compounding interest? Wouldn’t that be irrational, or at least unintelligent?
No. This confuses prices with preferences. I’m saying that you should not discount future utility merely because it is in the future, not that you should have flat consumption regardless of interest rates. If you can earn interest by waiting, a person who does not discount the future might opt to wait. Indeed, if you can earn interest by waiting, even a person who does discount the future might opt to wait!
Which is a worse problem overall: people discounting the future too much or not discounting the future enough? A lot of people have trouble optimizing for the present and thus put a great deal of weight on the future. They sacrifice happiness in the present for the promise of happiness in the future. For many people, this makes sense: The pains of pregnancy are worth it for the joy of a child. if you want a career in the military, the few months in boot camp make a lot of sense even if you’re miserable for that brief time.
A great and underrated question! Ultimately I say that excessively discounting the future is the greater problem. High discounting (better-known as “impulsivity”) leads predictably to all the canonical “social pathologies”: poverty, broken families, substance abuse, crime, and more. Furthermore, impulsivity is much more common, especially among young people. At the same time, I agree that a noticeable share of adults, perhaps 10-15%, are so future-oriented that they fail to enjoy life. They accumulate much wealth but get little pleasure out of it.
I don’t think it’s reasonable to say objective welfare exists. It’s always possible to imagine a mind that does not want something, even if all real people want whatever it is.
I’m not saying that all humans want their own objective welfare. I’m saying that objective welfare exists whether a human wants it or not. Not all kids want to go to sleep, but all kids will have unhappier lives if they’re habitually sleep-deprived.
To be clear, when I say “happy” and “unhappy” I mean emotional states, not preference satisfaction. We know them in ourselves directly via introspection and in others inferentially via facial expression, demeanor, and so on.
If you really want to bite the bullet on anti-paternalism, I’d like to hear how Russia should have handled the alcohol epidemic during the 1990s. Should it have kept taxes low?
I say yes. And instead of preaching to heavy drinkers to stop, I would have preached to families and romantic partners to shun heavy drinkers.