In the digital age, understanding user choices, preferences, and welfare has become increasingly complex. Our latest discussion paper explores how online intermediaries—such as social media, retail, and gaming platforms—shape user behaviour through choice architecture. This influence often leads to a discrepancy between what users do online and their underlying preferences and raises a fundamental question: how can we understand what users truly want when their actions are shaped by the choice architecture of online platforms?
The paper establishes a conceptual framework that differentiates between choices, preferences, and welfare, drawing on the economic concepts of stated and revealed preferences, and the behavioural economics distinction between ‘System 1’ (automatic, instinctive, and fast) and ‘System 2’ (conscious, deliberative, and slow) thinking to explain why online choices may not accurately reflect underlying preferences or welfare. We explore the effectiveness of a range of ‘user empowerment tools’ designed to help individuals make online choices that better align with their preferences by encouraging more considered decision-making. We propose a framework for considering when these tools are likely to be most beneficial, and how they might most effectively be deployed, drawing on recent empirical research.