Using Behavioural Insights to Argue for a Stronger Social Safety Net: Beyond Libertarian Paternalism

Abstract

Insights from experimental research in the behavioural sciences offer a powerful impetus to reject the new paternalist approach to social policy. The findings from psychology, behavioural economics and behavioural finance, concerning decision-making by people experiencing poverty, point to the importance of alleviating material hardship by improving the social safety net, rather than trying to remedy the character of individuals through welfare conditionality. Thus far, the behavioural sciences' usefulness as an intellectual weapon against punitive welfare reform has been underappreciated. This is partly due to underappreciation of the considerable contrast between the libertarian paternalism advocated by some behavioural scientists, which provides a rationale for governments to nudge citizens, and Lawrence Mead's new paternalism, which emphasises the personal responsibility of the poor for their circumstances. More importantly the disproportionate attention given to nudge has inhibited recognition that the behavioural research on poverty can be used to argue for more ambitious policy approaches which seek to transform behaviour in more ethical ways.

From me to us: Strengthening our Financial Capabilities

“…Failure to meet the conditions can result in payment suspension or termination, and thus reflects a constant element of risk. In turn, these requirements place an increased cognitive burden on those seeking support (Curchin, 2017), as they must learn how to navigate the requirements that their payments are contingent upon. With income support payments being the central source of income for many recipients, they experience "frequent anxiety about making a mistake with forms and requirements and being cut off" (Murphy et al, 2011, p. 138).…”

“…A central feature and focus of neoliberal politics is a concentration on behavioural management (Leggett, 2014). Whilst behavioural management has become prominent in a number of countries, it has functioned as a central feature of policy in a number of neoliberal reforms (Curchin, 2017;Leggett, 2014). It is noteworthy that the subject of behavioural management policies is often those who are in low-income and insecure households, and we can think of the associated approach to politics as one of libertarian paternalism (Curchin, 2017(Curchin, , 2019.…”

“…Whilst behavioural management has become prominent in a number of countries, it has functioned as a central feature of policy in a number of neoliberal reforms (Curchin, 2017;Leggett, 2014). It is noteworthy that the subject of behavioural management policies is often those who are in low-income and insecure households, and we can think of the associated approach to politics as one of libertarian paternalism (Curchin, 2017(Curchin, , 2019. Indeed, baked into the idea of behavioural management is an associated nexus of blame and responsibilitypeople are responsible for their circumstances and thus can be held accountable for the situation which they find themselves in.…”

Whom Do We Trust on Social Policy Interventions?

“…Social scientific claims have become highly influential in the public domain, particularly recently in the context of social policy interventions. A dominant example of this is behavioral interventions, under the catch all term "nudges" (Thaler & Sunstein, 2008), which have become highly popular decision-support methods used by governments to help in a wide range of areas such as health, personal finances, and general wellbeing (Curchin, 2017;Osman, 2016). The scientific claim, informed by psychological and behavioral economic research, is that to help people make better decisions regarding their lifestyle choices, and those that improve the welfare of the state, what is potentially effective is subtly changing the framing of the decision-making context, which makes prominent the option which maximizes long term future gains (Thaler & Sunstein, 2008;Sunstein, 2016a).…”

“…The scientific claim, informed by psychological and behavioral economic research, is that to help people make better decisions regarding their lifestyle choices, and those that improve the welfare of the state, what is potentially effective is subtly changing the framing of the decision-making context, which makes prominent the option which maximizes long term future gains (Thaler & Sunstein, 2008;Sunstein, 2016a). In essence the position adopted by Nudge enthusiasts is that poor social outcomes are often the result of poor decision-making, and in order to address this, behavioral interventions such as nudges can be used to reduce the likelihood of poor decisions being made in the first place (Curchin, 2017). This article aims to shed light on public opinion regarding social policy interventions, particularly with respect to the agent (Government, Scientist) that is proposing the intervention, and the extent to which trust is attributed to them.…”