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The Concept of Choice Architecture - Essay Example

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This study will critically evaluate the concept of choice architecture and the ‘Save More Tomorrow’ schemes adopted in the US and the UK. Thaler and Sunstein define a ‘choice architect’ as an individual who has the responsibility of shaping the context in which decision making takes place…
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The Concept of Choice Architecture
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Download file to see previous pages The present research has identified that in many of the publications concerning choice architecture, the idea of using choice architecture to make better choices has been emphasized. This is called libertarian paternalism which advocates freedom of choice. As such, people should be free to make choices and to opt out of programs as they wish. In 2012 a Committee of MPs suggested a relaxation of the NEST pension scheme in order to make it more attractive. This would involve elimination of the limit on how much can be paid in and the transfer of existing pension pots into the pension scheme. Currently, the workplace pension policy implemented by the UK government allows employees to opt out of the plan. Hence, the ability to opt out of the plan reflects libertarian paternalism. The resulting impact is that the employers as well as the government – as choice architects – have pointed the employees to a direction where they can attain a greater benefit. Meaning, the choice architects have enabled employees to make better choices that benefit them. The involvement of choice architects in libertarian paternalism is of vital importance. Choice architects enable better choices by nudging people. Nudge is an action used figuratively to suggest enablement or encouragement of people so that better choices can be made. So a choice architect points the individual to the decision which is beneficial but without restricting one’s freedom of choice or attempting to influence their choices or forcing the outcome on them. In the end choice architecture is an approach to make better decisions by focusing on intricacies and directing the decision maker through a relevant context. ...Download file to see next pagesRead More
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