Status Quo Bias in Decision Making

Status Quo Bias in Decision Making

William Samuelson and Richard Zeckhauser. 1988. (View Paper → )

Most real decisions, unlike those of economics texts, have a status quo alternative—that is, doing nothing or maintaining one's current or previous decision. A series of decision-making experiments shows that individuals disproportionately stick with the status quo. Data on the selections of health plans and retirement programs by faculty members reveal that the status quo bias is substantial in important real decisions. Economics, psychology, and decision theory provide possible explanations for this bias. Applications are discussed ranging from marketing techniques, to industrial organization, to the advance of science.

“Do nothing” isn’t neutral: when an option is framed as the current/default, people pick it far more often, even when switching is cheap, and the effect grows as the number of alternatives rises. The mechanisms span loss aversion, regret avoidance, anchoring, and cognitive dissonance, with some rational frictions layered on top.

For product builders, the message is practical (and ethical): defaults are powerful; reduce choice overload; make switching safe, reversible, and salient; and test copy and timing around “keep current settings” because default design will often move behaviour more than features or pricing.