Nudge: Improving Decisions About Health, Wealth, and Happiness

Any individual who has the power to alter the context in which choices are made. The architect does not make decisions for others but nudges them in a particular direction or away from others. Small changes in choice architecture can have a tremendous impact on decisions.

Default options are an essential component of choices. The default is what happens when no active choice is made on the part of the potential decision-maker. Thaler and Sunstein note that choice architects must attend to default options because many people (from inertia, inattention, or otherwise) will passively choose it. They note that it is impossible not to have a default, even if the default mandates a choice from the potential decision-maker.

The view that policies should be aimed at helping people freely make the choices that are in their own best interest. The libertarian paternalist relies on the “nudge” to push people toward choices of individual and social benefit without mandating behaviors or penalizing people for making different choices. It aims to balance the values of individual liberty and social well-being.

According to Thaler and Sunstein, a nudge is “any aspect of the choice architecture that alters people’s behavior in a predictable way without forbidding any options or significantly changing their economic incentives” (8). Nudges can be intentional or unintentional elements in the context surrounding decision-making that influences those decisions toward one option or away from others.

This is “any aspect of choice architecture consisting of friction that makes it harder for people to obtain an outcome that will make them better off” (153). Intentionally produced sludge has the aim of limiting access to options the architect wants people to avoid, generally for self-interested or political reasons.