My column on the economics of self-control is up at CANTA. A few choice excerpts:
If the psychologists and the behavioural economists are right, then we effectively have warring factions inside our head, all the time. There’s the me who wants to check Twitter rather than finish this column and the me who wants to finish the column so I can get on to other things. They’re currently yelling at each other. The same battle plays out in diverse forms for most of us. The preferences revealed then by our actions are the emergent outcomes of the minor battles inside our heads for control.
Some critics of individual choice take this as reason for government intervention to favour one faction over the other in our internal battlefields. In these models, we help smokers by taxing cigarettes and help the obese by forcing them away from food. But remember Baby Pareto’s crying: if you really do prefer to stop the short-term hedonist in your head from harming your longer-term interests, some clever entrepreneur can profit. And indeed, when we go out in search of self-disciplining mechanisms, we find that the market provides. There are myriad programmes to block you from surfing the web when you should be working. Problems sticking to an exercise regimen? Hire a personal trainer to mock your lack of effort. If you want to quit drinking, you can get a prescription for a drug that will make you violently nauseous if you do drink.
Should we ban Twitter when you can buy the Twitter-blocking programme Freedom for $10 with a 90-day money-back guarantee? Hardly.
Further, people often want excuses for doing embarrassing or disapproved things. While it’s true that people are more likely to engage in risky sex after a night out drinking, they’re also more likely to report positive sexual experiences after drinking. Should we conclude that drinking made them go out and do bad things, or that people sometimes drink to give themselves an excuse?
If we want to help people exercise self-control and make good choices, we should encourage the use of the readily available market solutions that work to those ends: voluntarily chosen constraints are far less likely to make Baby Pareto cry than are those paternalisms imposed from on-high. We otherwise require government to choose sides in the war inside your head when non-interventionism is likely best.