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Code, Nudge, or Notice?

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ABSTRACT: Regulators are increasingly turning to means other than law to influence citizen behavior. This Essay compares three methods that have particularly captured the imagination of scholars and officials in recent years. Much has been written about each method in isolation. This Essay considers them together for the first time in order to generate a novel normative insight about the nature of regulatory choice.

The first alternative method, known colloquially as architecture or “code,” occurs when regulators change a physical or digital environment to make undesirable conduct difficult. Speed bumps provide a classic example. The second method, libertarian paternalism or “nudging,” refers to leveraging human bias to guide us toward better policy outcomes. For instance, the state might attempt to increase organ donation by moving to an opt-out system because people disproportionally favor the status quo. Finally, mandated disclosure or “notice” requires organizations to provide individuals with information about their practices or products. Examples include everything from product warnings to privacy policies.

These methods feel more distinct than they actually are. The timely example of graphic warnings on cigarettes illustrates how hard it can be to characterize a given intervention and why categories matter. The issue— which was headed for the Supreme Court—turned on whether the Food and Drug Administration (“FDA”) intended for the warnings to change smoker behavior or merely to provide information. The FDA abandoned the intervention when it became clear the “warnings” were really about driving down smoking. Indeed, whether regulators employ code, nudge, or notice, they almost always have a deeper choice between helping citizens and hindering them. This Essay argues that regulators should choose “facilitation” over “friction” where possible, especially in the absence of the usual safeguards that accompany law.

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