Status Quo Bias .

• Status Quo Bias

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System justification - Relation to status quo bias

1 Generally, the status quo bias refers to a tendency to prefer the default or

established option when making choices


Status quo bias

1 'Status quo bias' is a cognitive bias; a preference for the current

state of affairs. The current baseline (or status quo) is taken as a

reference point, and any change from that baseline is perceived as a

loss.


Status quo bias

1 Status quo bias should be distinguished from a rational

preference for the status quo ante, as when the current state of affairs is objectively superior to the available

alternatives, or when imperfect information is a significant problem. A large body of evidence, however,

shows that status quo bias frequently affects human decision-making.


Status quo bias

1 Status quo bias interacts with other non-rational cognitive processes such as loss

aversion, existence bias, endowment effect, longevity, mere exposure, and regret

avoidance. Experimental evidence for the detection of status quo bias is seen through the use of the Reversal test. A vast amount of experimental and field examples exist. Behavior in regard to retirement plans,

health, and ethical choices show evidence of the status quo bias.


Status quo bias - Examples

1 Daniel Kahneman|Kahneman, Richard Thaler|Thaler, and Jack Knetsch|Knetsch created experiments that could produce this effect reliably. Samuelson and Zeckhauser (1988)

demonstrated status quo bias using a questionnaire in which subjects faced a series of decision problems, which were alternately framed to be with and without a pre-existing

status quo position. Subjects tended to remain with the status quo when such a

position was offered to them.


Status quo bias - Examples

1 The US states of New Jersey and Pennsylvania inadvertently ran a

real-life experiment providing evidence of status quo bias in the

early 1990s


Status quo bias - Explanations

1 Loss aversion, therefore, cannot wholly explain the status quo bias,

with other potential causes including regret avoidance, transaction costs

and psychological commitment.


Status quo bias - Rational Routes to Status Quo Maintenance

1 A status quo bias can also be a rational route if there are cognitive or informational

limitations.


Status quo bias - Irrational Routes to the Status Quo Bias

1 The irrational maintenance of the status quo bias links and confounds many cognitive

biases.



1 An assumption of longevity and goodness are part of the status quo

bias. People treat existence as a prima facie case for goodness,

aesthetic and Longevity increases this preference.



1 The status quo bias affects people’s preferences; people report

preferences for what they are likely rather than unlikely to receive.

People simply assume, with little reason or deliberation, the goodness

of existing


Status quo bias - Mere exposure

1 Mere exposure is an explanation for the status quo bias. Existing states

are encountered more frequently than non-existent states and because of this they will be perceived as more true and evaluated more preferably.



1 A tendency to overemphasize the avoidance of losses will thus favor

retaining the status quo, resulting in a status quo bias



1 Omission bias may account for some of the findings previously ascribed to status quo

bias.


Status quo bias - Detection

1 If they are unable to do so, then we have reason to suspect that they suffer from status

quo bias


Status quo bias - Neural Activity

1 A study found that erroneous status quo rejections have a greater neural

impact than erroneous status quo acceptances. This asymmetry in the

genesis of regret might drive the status quo bias on subsequent

decisions.



1 Research by University College London scientists that examines the neural pathways involved in 'status quo bias' in the human brain and found that the more difficult the

decision we face, the more likely we are not to act.



1 This indicates that the STN plays a key role in overcoming status quo bias when the decision is difficult.


Status quo bias - Behavioral Economics and the Default position

1 Against this background, two behavioral economists devised an opt-out plan to help employees of a particular company build

their retirement savings. In an opt-out plan, the employees are automatically enrolled unless they explicitly ask to be excluded.

They found evidence for status quo bias and other associated effects. They also noted that

changing the default alternatives has, in some instances, been shown to have dramatic effects on people’s choices.


Status quo bias - Conflict

1 Status-Quo educational bias can be both a barrier to political progress

and a threat to the state's legitimacy/ argue that the values of stability, compliance, and patriotism

underpin important reasons for status quo bias that appeal not to the

substantive merits of existing institutions but merely to the fact

that those institutions are the status quo


Status quo bias - Relevant fields

1 The Status quo bias is seen in important real life decisions; it has been found to be prominent is data on selections of health care plans

and retirement programs.


Status quo bias - Ethics

1 Status quo bias may be responsible for much of the opposition to human

enhancement in general and to genetic cognitive enhancement in

particular.


Status quo bias - Health

1 The results of this study indicate that the status quo bias may exist in

stated-choice studies, especially with medications that patients have to

take daily such as asthma maintenance medications. Stated-

choice practitioners should include a current medication in choice surveys

to control for this bias.


Status quo bias - Retirement plans

1 An example of the status quo bias affecting retirement plans is a study done that examined the U.S. equity

mutual fund. They found that people maintained the plan they had

previously, even if it was no longer the optimal choice.


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Status Quo Bias .

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