Regulatory Paternalism: When is it Justified?

Paternalism appears to lie behind a large number of regulatory measures. These include not only specific instances such as compulsory social insurance; the compulsory wearing of seatbelts and safety helmets; and ‘cooling-off periods’ enabling consumers and investors to withdraw from contractual undertakings. They also include, more generally, prohibiting or controlling certain risk-generating products and services (for example, meat which may be contaminated by BSE) as an alternative to providing information on the risk and leaving it to consumers to decide whether they wish to purchase the product or service. The appropriateness or otherwise of a paternalist intervention would appear to be a particularly important issue for theoretical analysis, not the least because in modern times policy makers appear to be caught on the horns of a dilemma: in a risk-obsessed society there is an ever-increasing expectation that governments will provide citizens with protection, and yet there is also a greater degree of scepticism of the ability of governments to do this successfully. This chapter argues that paternalism is, in appropriate circumstances, a legitimate and important reason for interventionist measures and, as such, should be taken seriously by regulatory scholars and policy makers. It presents an analytical framework which can establish an impressionistic profile for a given paternalistically justified measure, thereby giving some indication of whether the costs involved are likely to be disproportionate to the prospective benefits.