In Loco Parentis: A Paternalism Ranking of the States

Abstract

Which states are the most paternalistic, in terms of telling you what you can and can’t do? Which states tax individual choices like gambling, smoking, or using plastic bags most heavily? This chapter ranks the states according to how much their tax codes distort individual choices in private markets. The ranking shows which states try to control your choices by taxation, and which ones leave the choices up to you. Key takeaways: (1) Paternalistic policies may have positive effects that are easy to see, but they also have hidden unintended consequences. (2) Wyoming has the most freedom from paternalism, while New York is the most paternalistic state. (3) The indexes in this chapter can help policymakers understand the level and potential harm of paternalism in their state.

Keywords: paternalism, statism, taxation, tax policy, ranking, behavioral economics, California, New York, Wyoming, New Jersey, sin taxes

JEL Classification: H2, H7, H71