Nudging, Dark Patterns and Human Autonomy

The advent of behavioural economics, and the various "nudge" decision-making initiatives that it has spawned, is widely thought to be a good thing in both the public policy and commercial realms. But is that necessarily so?

Behavoural economics targets cognitive biases, and one's reliance on heuristics in a complex world, to influence human decision-making. It may well be that nudges aim to persuade rather than compel choices all in a good cause. Yet their subliminal effect runs rough-shod over the concept of informed consent and risks undermining basic human autonomy. And this raises the question of where the responsibility for outcomes, including unintended consequences, finally rests.

There have been long-standing privacy concerns about the use of nudge techniques to collect personal data. More recently, the use of "dark patterns" -- namely, "deceptive designs used in the user experience on digital platforms" -- has attracted growing attention from both financial and market regulators. However, the practical efficacy of the emerging regulatory frameworks seems very much an open question.

The ethical dimension of the responsible use of behavioural economics is a subject of importance to actuaries as well as those who rely on their work.