One of my subjects at uni this semester (micro-economic theory and policy) is dedicated to analyzing welfare changes and in particular converting the infamous 'util' measure (an ordinal measure of preferences) to a dollar value. This (to me anyway) is extremely exciting stuff because now all of the theories about consumer behavior have some application.
As with most new things I learn, I spent hours daydreaming about how I could change the world with this new found knowledge. This got me thinking about the definition of welfare and prompted a bit of 'on-the-side study'.
So I found a video lecture (by George Loewenstein, Department of Social and Decision Sciences, Carnegie Mellon University) on 'lite (soft) paternalism'. Paternalism stems from the idea that people may not want whats best for them and therefore need a 'parent' to guide them in making decisions. So soft paternalism is basically not quite big brother but almost. Consumers still have complete choice over their actions but a governing body skews incentives towards 'better' products. For example, fast food tax to persuade us to eat healthier.
So is welfare to be measured on the conventional method of 'consumer knows best' or by a standard set by a governing body?
If you are anti soft paternalism think about the already existing policies like cigarette tax and (to a lesser extent) import tarrifs. Should we lobby against them?
If you are pro soft paternalism, how far do we go?
