In March 2024, Daniel Kahneman – the man who did perhaps more than anyone else to shape the field of behavioural public policy – died. He is among a small handful of scholars who have had a huge effect on my own career, and in this essay – the first in a series of essays in a special section of the Journal that honour him – I reflect on how his work inspired much of my own.

This special issue explores foundational questions in behavioral economics and behavioral public policy, drawing on the work of Mario Rizzo, a critical voice in the debate on behavioral paternalism. Behavioral economics has offered significant insights into decision-making, often challenging traditional economic models. However, it has also introduced normative frameworks into policy analysis, such as preference purification, that critics argue oversimplify human decision-making and risk imposing external values. Contributions to this issue examine themes including the tension between standard rationality and inclusive rationality, the epistemological limitations of paternalistic interventions, and the role of tacit knowledge and dynamic learning in policymaking. By engaging perspectives from economics, psychology, philosophy, and law, the issue discusses process-based approaches to policy analysis that respect individual agency and accommodate uncertainty. It also highlights the political economy dimensions of behavioral public policy, emphasizing the need for institutional reforms that enable learning and systematic change rather than narrowly focusing on individual cognitive biases. This issue serves as both a tribute to Mario Rizzo’s intellectual contributions and a call for a deeper reflection on the methodological and normative foundations of behavioral public policy.

Paternalistic nudging and framing aim to correct flaws in deliberation by relying on the same cognitive mechanisms that create those flaws. Regarding some choices as flawed and in need of correction requires some standard of correctness. In their well-known book, Nudge, Thaler and Sunstein take the individual's own “purified” preferences to be that standard, which is inconsistent with the finding of behavioral economics that individuals do not have a stable preference ranking of alternatives, but instead construct their preferences when faced with a choice. This essay defends an alternative, readily usable standard to judge whether individuals are choosing badly and whether nudges can help them to choose better.

The heart of prospect theory is the value function, proposing that the carriers of value are positive or negative changes from a reference point. Daniel Kahneman observed that if prospect theory had a flag, the value function would be drawn on it. The function is nonlinear, reflecting diminishing sensitivity to magnitude. When describing how human lives are valued, the function exposes profound incoherence. An individual life is highly valued and thus vigorously protected if it is the only life at risk. But that life loses its value when it is one of many endangered by a larger tragedy. Beyond this insensitivity, the function may actually decline when many lives at risk become mere numbers. The more who die, the less we care. Implications of this deadly ‘arithmetic of compassion’ for understanding and managing the risk from nuclear weapons are briefly discussed.

During the Cold War, logical rationality – consistency axioms, subjective expected utility maximization, Bayesian probability updating – became the bedrock of economics and other social sciences. In the 1970s, logical rationality underwent attack by the heuristics-and-biases program, which interpreted the theory as a universal norm of how individuals should make decisions, although such an interpretation is absent in von Neumann and Morgenstern’s foundational work and dismissed by Savage. Deviations in people’s judgments from the theory were thought to reveal stable cognitive biases, which were in turn thought to underlie social problems, justifying governmental paternalism. In the 1990s, the ecological rationality program entered the field, based on the work of Simon. It moves beyond the narrow bounds of logical rationality and analyzes how individuals and institutions make decisions under uncertainty and intractability. This broader view has shown that many supposed cognitive biases are marks of intelligence rather than irrationality, and that heuristics are indispensable guides in a world of uncertainty. The passionate debate between the three research programs became known as the rationality wars. I provide a brief account from the ‘frontline’ and show how the parties understood in strikingly different ways what the war entailed.

With the increasing availability of life-saving vaccines against the SARS-CoV-2 virus, government agencies face the challenge of promoting vaccine uptake. Thus, encouraging vaccine uptake marks an urgent policy challenge in fighting the COVID-19 pandemic. This study builds on the theory of psychological ownership to design a behaviorally inspired local government vaccination campaign. We conducted a large-scale, cluster-randomized field experiment (N = 27,298 residents nested in 6,442 addresses) delivered to all registered residents of a German municipality via an official mailing campaign. The campaign included a psychological ownership intervention designed to boost residents’ intentions to get vaccinated – measured through unique link clicks on a municipal website where people can schedule a COVID-19 vaccination appointment. Findings suggest that adding possessive pronouns (i.e., ‘YOUR vaccination’) increases vaccination intentions by 39%, or 2.5 percentage points (p < 0.0001 [95% CI = 1.8%, 3.3%], control letter: 6.4%, treatment letter: 8.9%). The discussion outlines the value of using psychological ownership-based nudge interventions to increase vaccine uptake and other desirable behaviors.

Kahneman and Tversky’s ‘Prospect Theory’ paper famously demolishes expected utility theory as a predictive device. However, it presents deviations from that theory as ‘normatively unacceptable’ and argues that decision-makers would normally correct them when possible. In a later paper, Kahneman rejects a similar argument (the ‘discovered preference’ hypothesis) advanced by Plott. Later still, Kahneman endorses Sunstein and Thaler’s ‘libertarian paternalism’, which aims to help people avoid deviating from their ‘true’ preferences. I report an email correspondence between Kahneman and me in which we debated whether his position on libertarian paternalism was consistent with his critique of Plott’s hypothesis.

A core normative assumption of welfare economics is that people ought to maximise utility and, as a corollary of that, they should be consistent in their choices. Behavioural economists have observed that people demonstrate systematic choice inconsistences, but rather than relaxing the normative assumption of utility maximisation they tend to attribute these behaviours to individual error. I argue in this article that this, in itself, is an error – an ‘error error’. In reality, a planner cannot hope to understand the multifarious desires that drive a person’s choices. Consequently, she is not able to discern which choice in an inconsistent set is erroneous. Moreover, those who are inconsistent may view neither of their choices as erroneous if the context reacts meaningfully with their valuation of outcomes. Others are similarly opposed to planners paternalistically intervening in the market mechanism to correct for behavioural inconsistencies, and advocate that the free market is the best means by which people can settle on mutually agreeable exchanges. However, I maintain that policymakers have a legitimate role in also enhancing people’s agentic capabilities. The most important way in which to achieve this is to invest in aspects of human capital and to create institutions that are broadly considered foundational to a person’s agency. However, there is also a role for so-called boosts to help to correct basic characterisation errors. I further contend that government regulations against self-interested acts of behavioural-informed manipulation by one party over another are legitimate, to protect the manipulated party from undesired inconsistency in their choices.

This paper critically assesses Rizzo and Whitman’s theory of inclusive rationality in light of the ongoing cross-disciplinary debate about rationality, welfare analyses and policy evaluation. The paper aims to provide three main contributions to this debate. First, it explicates the relation between the consistency conditions presupposed by standard axiomatic conceptions of rationality and the standards of rationality presupposed by Rizzo and Whitman’s theory of inclusive rationality. Second, it provides a qualified defence of the consistency conditions presupposed by standard axiomatic conceptions of rationality against the main criticisms put forward by Rizzo and Whitman. And third, it identifies and discusses specific strengths and weaknesses of Rizzo and Whitman’s theory of inclusive rationality in the context of welfare analyses and policy evaluation.

Many moral judgments are rooted in the outrage heuristic. In making such judgments about certain personal injury cases, people’s judgments are both predictable and widely shared. With respect to outrage (on a bounded scale of one to six) and punitive intent (also on a bounded scale of one to six), the judgments of one group of six people, or 12 people, nicely predict the judgements of other groups of six people, or 12 people. Moreover, outrage judgments are highly predictive of punitive intentions. Because of their use of the outrage heuristic, people are intuitive retributivists. People care about deterrence, but they do not think in terms of optimal deterrence. Because outrage is category-specific, those who use the outrage heuristic are likely to produce patterns that they would themselves reject, if only they were to see them. Because people are intuitive retributivists, they reject some of the most common and central understandings in economic and utilitarian theory. To the extent that a system of criminal justice depends on the moral psychology of ordinary people, it is likely to operate on the basis of the outrage heuristic and will, from the utilitarian point of view, end up making serious and systematic errors.

Once vaccines against COVID-19 became available in many countries, a new challenge has emerged – how to increase the number of people who vaccinate? Different policies are being considered and implemented, including behaviourally informed interventions (i.e., nudges). In this study, we have experimentally examined two types of nudges on representative samples of two countries – descriptive social norms (Israel) and saliency of either the death experience from COVID-19 or its symptoms (UK). To increase the legitimacy of nudges, we have also examined the effectiveness of transparent nudges, where the goal of the nudge and the reasons of its implementation (expected effectiveness) were disclosed. We did not find evidence that informing people that the vast majority of their country-people intend to vaccinate enhanced vaccination intentions in Israel. We also did not find evidence that making the death experience from COVID-19, or its hard symptoms, salient enhanced vaccination intentions in the UK. Finally, transparent nudges as well did not change the results. We further provide evidence for the reasons why people choose not to vaccinate, and whether different factors such as gender, belief in conspiracy theories, political ideology, and risk perception, play a role in people's intentions to vaccinate or susceptibility to nudges.

Dark patterns – design interfaces or features that subtly manipulate people in making suboptimal decisions – are ubiquitous especially in e-commerce websites. Yet, there is little research on the effectiveness of dark patterns, and even lesser studies on testing interventions that can help mitigate their influence on consumers. To that end, we conducted two experiments. The first experiment tests the effectiveness of different dark patterns within a hypothetical single product online shopping context. Results show that, indeed, dark patterns increase the purchase impulsivity across all dark patterns, relative to the control. The second experiment tests the effectiveness of three behaviorally informed interventions on four different dark patterns also in a hypothetical online shopping scenario, but this time offering multiple products instead of a single product. Between-subject analysis shows that not all interventions are equally effective, with uneven impact across dark patterns. However, within-subject results indicate that all interventions significantly reduce purchase impulsivity pre- versus post-intervention, indicating that any intervention is better than none when it comes to combating dark patterns. We then end by discussing the policy implications of our results.

For all their differences, the two rival theories of human behavior have many unfortunate similarities. Standard rational choice theory posits that individuals use rational techniques to pick ends that meet their set of private preferences. Modern theories of behavioral economics point to systematic deviations from those principles. Both approaches assume that all preferences are individually based. However, the evolutionary principle of inclusive fitness insists that in family situations, it is the welfare of the unit, not of any of single individual, that explains various forms of natural love and affection that arise because of the interdependence of − and the redistribution of − wealth it requires. Likewise, both standard theories ignore variations in tastes and in competence levels that allow for gains from trade across competence levels. This paper then reinterprets the common treatment of nudges and the various legal doctrines dealing with disabilities, product liability, and firm structure where the standard assumptions of uniform behavior miss the salient features of human behavior and social interactions.

This paper examines Daniel Kahneman’s concept of experienced utility and its roots in Bentham’s hedonic utilitarianism. It focuses on Kahneman’s call for a ‘separate value judgement’ to determine when experienced utility can be used to evaluate temporally extended outcomes (TEOs). Two potential judgements are proposed: comprehensiveness and personal independence. Comprehensiveness means that the measurement of utility captures all relevant aspects of instant utility. Personal independence means that the TEO is fully independent of other TEOs with which it might be combined (or ‘concatenated’). I argue that identifying TEOs meeting these criteria may be challenging, possibly restricting the applicability of experienced utility. I conclude by considering the implications for behavioural science’s quest for an unambiguous, measurable operationalisation of utility.

In this paper, I pick up on an important theme in Mario Rizzo’s work: that rationality should be understood more broadly than the rational choice model as learning to adjust behaviour in the light of experience and the mistakes that it yields. In particular, I focus on learning-by-doing (LBD). I argue in the first part of the paper that it should be regarded as one of the central insights in economics, alongside those that are more usually recognised like the gains from trade and the importance of unintended consequences. I use Smith and Hirschman’s discussion of LBD to ground this claim. In the second part of the paper, I turn to the determinants of LBD in teams. I argue that the key rule or constitutional/policy design question is how best to embrace the diversity that is central to LBD within teams without this undermining the social origins of co-operation in teams.

Daniel Kahneman’s legacy is best understood in light of developments in economic theory in the early-mid-20th century, when economists were eager to put utility functions on a firm mathematical foundation. The axiomatic system that provided this foundation was not originally intended to be normative in a prescriptive sense but later came to be seen that way. Kahneman took the axioms seriously, tested them for descriptive accuracy, and found them wanting. He did not view the axioms as necessarily prescriptive. Nevertheless, in the research program he conceived, factual discoveries about real decision-making were stated as deviations from the axioms and thus deemed ‘errors’. This was an unfortunate turn that needs to be corrected for the psychological enrichment of economics to proceed in a productive direction.

Debtors were stimulated to contact their creditors to negotiate a repayment plan. Contacting creditors was important because debtors were unlikely to repay the debt immediately and upon contacting, debtors could agree on a repayment plan to repay the debt in the long run. Using insights from scarcity theory and nudging techniques, a standard debt repayment letter was adapted and both letters were compared. Experimental results (N = 3,330) provide support for the use of nudging techniques as more debtors agreed on a repayment plan and response rates increased. The results underline the importance of stimulating debtors to contact their creditors.

While in his early years, Kahneman followed the world of classic utilitarianism in which smart individuals base decisions on how they will truly feel each moment in the future, Kahneman in Mandel (2018) adopted a very different position, namely that what matters is the story people tell of their lives. He thus grappled with evolving stories of both the future and the past, and the presence of different decision-supporting evaluations for the short-run and the long-run.

Important challenges like climate change require transformative policy responses. According to a growing public policy literature, such transformative responses typically require complex policy packages that bundle various individual policy instruments to complement each other, compensate transition losers, and create positive synergies. Nevertheless, while adding new instruments to a package can increase policy effectiveness, it comes at a price: increased policy design complexity. Increased complexity potentially leads to fundamental public misperceptions that undermine policy legitimacy and feasibility. Here, I argue that complex policy packages affect public opinion through a compensation, policy perception, and design complexity mechanism. To test this argument, this study assesses if citizens evaluate proposals for isolated climate policies related to food and mobility behaviors differently to complex policy packages. Employing a novel two-stage conjoint-experimental approach with 9115 respondents from the USA and Germany, the study shows that policy packaging increases citizens’ perceived policy effectiveness to reduce climate pollutants, but also perceived restrictions on citizens’ lifestyles. Moreover, increased design complexity can lead citizens to pay special attention to salient costly parts of policy packages. However, increased design complexity does not fundamentally reverse preferences. Through packaging desired and undesired policy instruments, policymakers can increase public support for transformative climate policies.