Loss Aversion and Status Quo Label Bias
“The innate force of matter is a power of resisting, by which every body, as much as in it lies, endeavors to preserve in its present state.”
This is interesting: “A policy’s attractiveness increases when it is labeled status quo.”
Three types of tendencies confer advantage to status quo:
1. Tendencies to refrain from action altogether. In a seminal paper, Samuelson and Zeckhauser (1988) noted: “Most real decisions … have a status quo alternative — that is, doing nothing or maintaining one's current or previous decision” (p7). Indeed, since status quo is almost always also the default, any tendencies against action or choice (such as: decision aversion; choice deferral; omission bias; inaction inertia) uphold the status quo.
2. Tendencies towards particular actions (“to follow customary company policy, to elect an incumbent to still another term in office, to purchase the same product brand, or to stay in the same job”, Samuelson & Zeckhauser, p8) — in particular routinization of choic — also uphold status quo.
3. A third type of tendency makes status quo look better than it would otherwise. Social psychologists such as Jost and his colleagues offered a motivated account for this tendency – system justification theory – which posits a psychological need to view the existing order in a positive light.
Source: Loss Aversion and Status Quo Label Bias
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