How the Status Quo Bias Affects Your Decisions

The status quo bias is one type of cognitive bias that involves people preferring that things stay as they are or that the current state of affairs remains the same. This bias can have an effect on human behavior, but it is also a topic of interest in other fields, including sociology, politics, and economics.

By being aware of how the status quo bias influences your decisions and behaviors, you can look for ways to reduce the bias in the choices you make each and every day.

Overview

Change can be a scary thing for many people, which is perhaps why many tend to prefer that things simply stay the way they are. In psychology, this tendency is known as the status quo bias, a type of cognitive bias in which people exhibit a preference for the way things are currently. When changes do occur, people tend to perceive them as a loss or detriment.

The status quo bias can make people resistant to change, but it can also have a powerful effect on the decisions they make.

The term "status quo bias" was first introduced by researchers William Samuelson and Richard Zeckhauser in 1988. In a series of controlled experiments, Samuelson and Zeckhauser found that people show a disproportionate preference for choices that maintain the status quo. Participants were asked a variety of questions, for example, in which they had to take the role of the decision-maker in situations faced by individuals, managers, and government officials.

Based on the results, the research showed a strong status quo bias in the responses. When making an important choice, people are more likely to pick the option that maintains things as they are currently.

Explanations for the Status Quo Bias

So why do people tend to have such a strong bias for the status quo? A number of other cognitive biases support the existence of the status quo bias.

Loss Aversion Bias

As they consider their choices, people focus more on what they stand to lose rather than how they might benefit. According to the "prospect theory," an economics theory developed by researchers Daniel Kahneman and Amos Tversky in 1979, "losses loom larger than gains." In other words, the potential for loss stands out in people's minds much more prominently than the potential for gains.

For example, the research by Samuelson and Zeckhauser also found that younger workers were more likely to sign up for a health insurance plan that had better premiums and deductibles, while older employees were more likely to stick with their old but less favorable plans.

The older employees may be more concerned with minimizing any possible losses rather than risking everything on some potential gains. They know what to expect from their current plan, so they are not willing to take the risk on a new plan even though the switch might come with financial benefits.

Exposure

Mere exposure, or the tendency to prefer things as they are simply because they are familiar, may also play a role. Researchers have found that people prefer a wide variety of things simply because they are familiar with them, including words, faces, line drawings, and even sounds. Quite often, the things we think we prefer only become favored because we are more familiar with them.

Impact of the Status Quo Bias

The status quo bias can have a serious impact on a wide variety of everyday decisions. For example, you may find yourself ordering the same menu item every time you visit your favorite restaurant. Some of the newer items on the menu may look tempting, but you already know that you will be satisfied with your old favorite.

Instead of trying a new dish, and running the risk that you will not like it, you'd rather stick to your tried-and-true favorite. This minimizes the risk of any potential losses (being unhappy with what you ordered), but you also miss out on the possible benefits, such as finding a new favorite dish.

Sticking with your current cable/satellite provider is another example of how the status quo bias may influence everyday decisions. Even though another provider might offer more channels at a cheaper price, you are already familiar with the rates, choices, and customer service offered by your current provider. The status quo bias might lead you to stay with your current provider in order to keep things the way they are, rather than to take a risk on an unfamiliar but potentially better service option.

For example, the bias is often used to explain why people fail to take advantage of investment and savings opportunities. Rather than place their money in investments that have a degree of risk, people often leave their money in low-yield savings accounts. The status quo bias leads people to maintain their financial situation as it currently is, rather than taking a risk on improving their financial outlook.

In politics, the status quo bias is also often used to explain the conservative mindset. People who identify as conservative tend to focus on maintaining traditions and keeping things the way they are. This avoids risks associated with change but also misses out on possible benefits that change might bring.

The status quo bias can also have an impact on the health choices that people make. One study found that when given the choice between their current medication and an even better medication, people are biased toward choosing their current medicine. Rather than risk trying an unknown medication that may have unknown effects, people prefer to stick with what they know, even if it is potentially not as good as the alternatives.

Of course, like many other cognitive biases, the status quo bias does have benefits. Because it prevents people from taking risks, the bias offers a certain degree of protection. However, this risk-avoidance can also have negative effects if the alternatives actually provide greater safety and benefits than the current state of affairs.