Skip to main content
Log in

Abstract

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.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

References

  • Akerlof, G. A., and Dickens, W. T. “The Economic Consequences of Cognitive Dissonance”,American Economic Review 72 (1982), 307–319.

    Google Scholar 

  • Bell, D. E. “Regret in Decision Making Under Uncertainty”,Operations Research 30 (1982), 961–981.

    Google Scholar 

  • Bem, D. J. “Self-Perception Theory”. In: L. Berkowitz, ed.,Advances in Experimental Social Psychology, Vol. 6, Academic Press, 1972.

  • Ben-Horin, D. “Dying to Work: Occupational Cynicism Plagues Chemical Workers”,In These Times 3 (June 27/July 3, 1979), 24.

    Google Scholar 

  • Brehm, J. “Postdecision Changes in the Desirability of Alternatives”,Journal of Abnormal Social Psychology 52 (1956), 384–389.

    Google Scholar 

  • Brockner, J., and Rubin J. Z.Entrapment in Escalating Conflict. Springer-Verlag, 1982.

  • David, P. “Clio and the Economics of QWERTY”,American Economic Review 75 (1985), 332–337.

    Google Scholar 

  • Degroot, M.Optimal Statistical Decisions. New York: McGraw-Hill, 1970.

    Google Scholar 

  • Doane, M. J., Hartman, R. S., and Woo, C. “Household Preference for Interruptible Rate Options and the Revealed Value of Service Reliability”, mimeo, Boston University, 1987.

  • Festinger, L., and Carlsmith, J. M. “Cognitive Consequences of Forced Compliance”,Journal of Abnormal and Social Psychology 58 (1959), 203–210.

    Google Scholar 

  • Gilbert, J. P., Light, R. J., and Mosteller, F. “Assessing Social Innovations: An Empirical Base for Policy”. In: W. Fairley and F. Mosteller, eds.,Statistics and Public Policy, Reading, Massachusetts: Addison-Wesley, 1977.

    Google Scholar 

  • Jeuland, A. P. “Brand Choice Inertia as One Aspect of the Notion of Brand Loyalty”,Management Science 25 (1979), 671–82.

    Google Scholar 

  • Kahneman, D., Knetsch, J. L., and Thaler, R. “Fairness as a Constraint on Profit Seeking: Entitlements in the Market”,American Economic Review 76 (1986), 728–741.

    Google Scholar 

  • Kahneman, D., Slovic, P., and Tversky, A.Judgment Under Uncertainty: Heuristics and Biases, Cambridge, England: Cambridge University Press, 1982.

    Google Scholar 

  • Kahneman, D., and Tversky, A. “Prospect Theory: An Analysis of Decision under Risk”,Econometrica 47 (1979), 263–281.

    Google Scholar 

  • Kahneman, D., and Tversky, A. “The Psychology of Preference”,Scientific American 246 (1982), 160–173.

    Google Scholar 

  • Kahneman, D., and Tversky, A. “Choices, Values and Frames”,American Psychologist 39 (1984), 341–350.

    Google Scholar 

  • Knetsch, J., Thaler, R., and Kahneman, D. “Reluctance to Trade: An Experimental Refutation of the Coase Theorem”, mimeo, 1987.

  • Knox, R. E., and Inkster, J. A., “Post Decision Dissonance at Post Time”,Journal of Personality and Social Psychology 8 (1968), 319–323.

    Google Scholar 

  • Kuhn, T. P.The Structure of Scientific Revolutions. Chicago: Chicago University Press, 1962.

    Google Scholar 

  • Langer, E.The Psychology of Control. Beverley Hills, CA: Sage Publications, 1983.

    Google Scholar 

  • Loewenstein, G. “Expectations and Intertemporal Choice”, Economics dissertation, Yale University, 1985.

  • Louis, A. M. “Schlitz's Crafty Taste Test”,Fortune (June 26, 1981), 32–34.

  • Mulanaphy, J. “Participants' Allocation Change and CREF Transfer Practices”, Teachers Insurance and Annuity Association, 1986.

  • Neipp, J., and Zeckhauser, R. “Persistence in the Choice of Health Plans”. In R. Scheffler and L. Rossiter, eds.,Biased Selection in Health Care Markets. Greenwich, CT: JAI Press, 1985.

    Google Scholar 

  • Nelson, R., and Winter, S.An Evolutionary Theory of Economic Change, Cambridge, Massachusetts: Harvard University Press, 1982.

    Google Scholar 

  • O'Hare, M., Bacow, L., and Sanderson, D.Facility Siting and Public Opposition, New York: Van Nostrand Reinhold, 1983.

    Google Scholar 

  • Pratt, J., Wise, D., and Zeckhauser, R. “Price Differences in Almost Competitive Markets”,Quarterly Journal of Economics 53 (1979), 189–211.

    Google Scholar 

  • Quattrone, G. A., and Tversky, A. “Contrasting Rational and Psychological Analyses of Political Choice”, mimeo, Stanford University, 1987.

  • Rowe, R. D., d'Arge, R. C., and Brookshire, D. S. “An Experiment on the Economic Value of Visibility”,Journal of Environmental Economics and Management 7 (1980), 1–19.

    Google Scholar 

  • Savage, L. J.The Foundations of Statistics, New York: Wiley, 1954.

    Google Scholar 

  • “Saying No to New Coke”,Newsweek (June 24, 1985), 32–33.

  • Schelling, T. C.The Strategy of Conflict. Cambridge, MA: Harvard University Press, 1960.

    Google Scholar 

  • Schmalensee, R. “Product Differentiation Advantages of Pioneering Brands”,American Economic Review 72 (1982), 349–365.

    Google Scholar 

  • Schoenberger, W.Decision Destiny, Athens, Ohio: Ohio University Press, 1979.

    Google Scholar 

  • Schotter, A., and Braunstein, Y. “Economic Search: An Experimental Study”,Economic Inquiry 19 (1981), 1–25.

    Google Scholar 

  • Simon, H.Models of Man. New York: Wiley, 1957.

    Google Scholar 

  • Stimson, H. S. “The Decision to Use the Atomic Bomb”,Harper's 197 (1947), 97–107.

    Google Scholar 

  • Thaler, R. “Toward a Positive Theory of Consumer Choice”,Journal of Economic Behavior and Organization 1 (1980), 39–60.

    Google Scholar 

  • Tversky, A., and Kahneman, D. “Judgment under Uncertainty: Heuristics and Biases”,Science 185 (1974), 1124–1131.

    Google Scholar 

  • Urban, G., Carter, T., Gaskin, S., and Mucha, Z. “Market Share Rewards to Pioneering Brands: An Empirical Analysis and Strategic Implications”,Management Science 32 (1986), 645–659.

    Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Rights and permissions

Reprints and permissions

About this article

Cite this article

Samuelson, W., Zeckhauser, R. Status quo bias in decision making. J Risk Uncertainty 1, 7–59 (1988). https://doi.org/10.1007/BF00055564

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1007/BF00055564

Key words

Navigation