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The mere-exposure effect is the tendency to develop a preference for things or people that are familiar to us.

Because people feel more regret for negative outcomes resulting from new actions than from inaction, regret avoidance causes us to favor the status quo. When faced with a decision whose outcome is highly uncertain, individuals often anticipate and attempt to eliminate the possibility of regret. This implies that in order for an individual to switch to an alternative option, it must be perceived as twice as beneficial as the status quo. In other words, the feeling of losing $100 is twice as strong as the feeling of winning $100.

Loss aversion suggests that losses are twice as psychologically harmful as gains are beneficial.

There are several concepts that contribute to the status quo bias: These often result in a preference for the current option or situation. In an effort to reduce complexity, people resort to a number of irrational mechanisms.

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One of the main drivers of the status quo bias is the difficulty of making decisions. For example, when your insurance company sends you your new policy, you simply renew it without shopping around for alternatives. When an action is the default, then status quo bias can lead to action bias. However, it’s important to note that status quo bias doesn’t always mean a preference for doing nothing. Phrases like “when in doubt, do nothing,” “better safe than sorry,” or “if it’s not broken, don’t fix it” reflect this kind of mentality.Īcross a range of everyday decisions, such as whether to change jobs, switch to another cell phone plan, or try a new restaurant, there is a tendency to refrain from shaking things up. When faced with complex decisions, people tend to choose the status quo, even if it’s suboptimal. It describes our irrational preference for a default option simply because it preserves the current state of affairs. Status quo bias is a type of cognitive bias. Status quo bias can create resistance to change, hinder progress, or cause us to miss out on valuable opportunities. You order the same dish as you always do, rather than take the risk on a new (and potentially tastier) option. However, you are really hungry, and you don’t want to risk choosing something you don’t like.īecause of status quo bias, you want to be on the safe side.

Looking at the menu, you feel tempted to try a new dish. Example: Status quo biasYou are having dinner with your friends at a restaurant you go to often.

This can impact the quality of their decisions. Because of this, they try to maintain the current situation. Under status quo bias, people perceive change as a risk or a loss. Status quo bias refers to people’s preference for keeping things the way they currently are.

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Mechanism behind actor observer bias