Ritov, I., & Baron, J. (1992). Status-quo and omission bias.
Journal of Risk and Uncertainty, 5, 49-61.
Status-quo and omission biases
Ilana Ritov and Jonathan Baron1
University of Pennsylvania
Abstract
Bias toward the status quo, found in choice and in emotional
reactions to adverse outcomes, has been confounded with bias
toward omission. We unconfounded these effects with scenarios in
which change occurs unless action is taken. Subjects reacted
more strongly to adverse outcomes caused by action, whether the
status quo was maintained or not, and subjects preferred inaction
over action even when inaction was associated with change. No
status-quo bias was found in a matching task, which did not
require action. The observed status-quo bias is at least partly
caused by a bias toward omissions.
1 Introduction
The term `status-quo bias' has been used to describe people's
tendency of `doing nothing or maintaining one's current or
previous decision' (Samuelson & Zeckhauser, 1988). Clearly,
there are two claims embedded in this statement: the claim that
people prefer to keep the current state of affairs; and the claim
that people are reluctant to take action that will change this
state.
Preference for the status quo, in risky as well as in riskless
choices, is generally explained in terms of loss-aversion
(Thaler, 1980; Kahneman & Tversky, 1984). Since the current
state serves as a reference point, a change usually entails
expected loss on some dimensions and expected gains on other
dimensions. As people are loss averse, the losses are weighed
more heavily than the gains. Hence people are unlikely to prefer
an alternative in which the expected gains are only slightly
higher than the expected losses. Loss aversion has been
considered responsible for the difference between selling price
and buying price. In one illustration of this effect, Viscusi,
Magat, & Huber (1987) found that the amount of money that
consumers would pay to reduce risk was less than the amount they
would accept to assume the same risk. Knetsch, Thaler, and
Kahneman (1988) established a status quo state simply by placing
the article to be priced on the subject's desk.
An alternative explanation of status-quo bias, as noted, is that
changing the status quo requires an act while keeping the status
quo requires only an omission, a failure to act. Subjects favor
harmful omissions over equally harmful commissions (Spranca,
Minsk, & Baron, in press). Even when the options in question
produce benefits as well as harms, omissions are favored (Spranca
et al, in press; Ritov & Baron, in press). Ritov & Baron (in
press), for example, found that many subjects preferred not to
vaccinate a child when the risk of death from disease was 10 in
10,000 but the risk of death from vaccine was 5 in 10,000 or
less. On the other hand, when the decision maker is seen as
responsible for those affected by the decision, subjects favor
commissions over omissions (Ritov & Baron, 1990).
The bias toward omissions is irrational in the same sense that
the status-quo bias is irrational. If rationality is the method
that best achieves our goals (Baron, 1988), and if our goals
concern the future outcomes of decisions, the current state or
the means of achieving outcomes are irrelevant (unless these
affect the achievement of goals). Spranca et al. (in press)
review the rationality question at greater length.
In a related series of studies, Kahneman and Tversky (1982) have
found that people feel a more poignant emotional reaction to
events that involve actions relative to events that have
identical outcomes but which do not involve actions. For
example, in the following scenarios, Paul and George experience
the same outcome. However, in George's case the outcome resulted
from action, whereas in Paul's case it resulted from inaction.
Paul owns shares in Company A. During the past year he
considered switching to stock in Company B, but he decided
against it. He now finds that he would have been better off by
$1,200 if he had switched to the stock of Company B.
George owned shares in Company B. During the past year he
switched to stock in Company A. He now finds that he would have
been better off by $1,200 if he had kept his stock in Company
B.
Subjects in Kahneman and Tversky's study predicted that George
will feel worse than Paul. Landman (1988) has extended this
finding to positive outcomes: people feel more elated when a
positive outcome resulted from action rather than inaction.
Anticipation of such positive or negative feelings could account
for the status-quo bias or the omission bias. If the potential
negative feelings are weighed more heavily than the potential
positive feelings resulting from a decision made under
uncertainty, then these biases would result.
Kahneman and Miller (1986) explained this phenomenon in terms of
norm theory: Outcomes are perceived as worse when subjects can
easily imagine that a better outcome could have occurred. When
an adverse outcome is caused by action, it is easy to imagine the
outcome of inaction, so the emotional reaction is strong. But
when an adverse outcome is caused by inaction, it is more
difficult to imagine the outcome of action, so the reaction is
not as strong. However, in all the above examples inaction was
completely confounded with maintaining current state. It is
possible that the change of state, rather than the protagonist's
involvement in the action which brought about this change, is the
cause of the intensified emotional reaction.
The three experiments reported here were designed to test
separately the two potential sources of the status-quo bias:
preference for maintaining current state and preference for
inaction. The first experiment found that a bad outcome (e.g.,
financial loss) of an event involving action on the part of the
victim is perceived as worse than an equivalent outcome when no
action was involved, even when action is associated with
maintaining the status quo (e.g., objecting to a stock being
sold).
The second experiment examined decisions involving tradeoffs
between two dimensions (e.g., deductible amount and co-insurance
rate of insurance policies). The experiment manipulated
orthogonally the options designated as the status quo (the first,
the second, or neither) and the option associated with action
(the first, the second, or both). It found an omission bias in
choice, but not a consistent status-quo bias.
The third experiment examined asked subjects to match two options
in desirability by providing a value of one dimension of one
option. Designating one of the options as the status quo had no
effect on the value of the dimension chosen. Here, action is not
involved, so this result supports the role of action in the
status-quo bias. In the same experiment, choices between options
favored the option associated with inaction, whether that option
was the status quo or not. We conclude that at least part of the
status-quo bias found elsewhere is the result of omission bias.
2 Experiment 1
In Experiment 1, a negative outcome (e.g., a financial loss)
results from an unhappy resolution of a risk (e.g, a stock
declines in value). In hindsight, we know that the outcome could
have been avoided if the person had chosen differently (e.g.,
sold the stock). Anticipations of the emotions attending such
outcomes could affect the initial decision.
Consider, for example, Frank, who was involved in the following
scenario:
Frank owned shares in Company B. During the past year his
investment manager asked him whether he would object to switching
to stock in Company A. Frank did not object. Now he finds out
that he would have been better off by $1,200 if he had kept his
shares in Company B.
If the change of state is the main source of intensified regret,
than Frank should feel just as bad as George felt in the previous
scenario. If, on the other hand, action is the primary factor in
determining regret, then Frank is better off, since the outcome
resulted from inaction on his part.
However, there is another difference between this new scenario
and the two former ones. In Frank's case the counterfactual
alternative is in some way closer to the actual one: all he had
to do was to say no to his investment manager's suggestion.
According to norm theory, the undoing of the outcome is more
easily imagined in Frank's case than in George's case, where one
has to imagine George refraining from switching to the stock of
Company A.
If the ease of mentally undoing the event affects the feelings of
regret, than we cannot directly compare Frank's case to the cases
of Paul and George. To overcome this difficulty we introduce
another scenario, in which a fourth person, Henry, faces the same
situation as Frank, but decides to object to the switch:
Henry owns shares in Company A. During the past year his
investment manager asked him whether he would object to switching
to stock in Company B. Henry objected and got to keep his shares
in Company A. Now he finds out that he would have been better
off by $1,200, if he had switched to the stock of Company B.
For both Frank and Henry the counterfactual alternative seems
quite close (relative to Paul and George). However, Frank's
state is changed through inaction, while Henry preserves his
status quo state through action. Thus the comparison between
subjects' prediction of Frank's and Henry's feelings will provide
a proper testing of the `action' hypothesis. If action, rather
than change of state amplifies feeling of regret, Henry should
feel worse than Frank, although the bad outcome did not follow a
change in his situation.
2.1 Method
Subjects. Twenty subjects participated in this experiment.
All subjects were undergraduates at the University of
Pennsylvania, recruited with a sign placed on a prominent campus
walkway and paid $5 per hour.
Stimulus materials. Five cases, all involving decisions
under uncertainty, were used. Some of these were based on the
cases used by Kahneman and Tversky (1982) and Landman (1988).
Each case was presented in four versions:
SQ-NO, the person's state did not change, and he committed no
action; an example of this version is Paul's story, in the
scenario described earlier;
CH-ACT, the person's state was changed through his own action;
George's scenario is an example of this version;
CH-NO, the person's state was changed, without his committing an
action; Frank's scenario is an example of this condition; and
SQ-ACT, the person preserved the status quo state through action,
as Henry did, in the above example.
In addition to the case described above, four other cases were
used. We will present here the CH-NO version of each of the
cases:
I. Sam, upon arriving at the airport, was asked whether he would
object if, for bureaucratic reasons he would be switched to
another flight from the flight he was booked on for several
weeks. Sam did not object. The plane crashed and he was
injured.
II. Frank, in the above example.
III. Rose, a student at Penn, and her roommate enrolled in
Section 1 of Biology 101. At the beginning of the term, for
purely bureaucratic reasons, Rose was asked whether she would not
mind being transferred to Section 2. She did not object. The
term is over and Rose just learned she got a D in the course.
Her roommate, who remained in Section 1, got a B.
IV. Steve worked for Allied Van Lines. Last year a group of
workers, including Steve, were transferred by the company to
United Van Lines. Any of the transferred workers could have
objected to the switch, and would have, in that case, kept his
old job. A month ago Steve was permanently laid off by United
Van Lines.
V. Ruth took a cab to the airport. As traffic was heavy, the
driver asked her whether she would object to his taking a certain
shortcut road. Ruth did not object. However, traffic on the
shortcut road was delayed because of an accident that had just
occurred on that road and Ruth missed her flight.
Procedure: Each subject received all four versions of each of the
five cases. The instructions at the top of the questionnaire
read as follows:
In each of the following cases, four people will experience
similar events. The final outcome will be identical for all
four, but the chain of events leading to this outcome will
differ. You are asked to rank these four people in terms of how
bad they feel. Write `1' next to the name of the person who
feels worst, `2' nest to the name of the person who feels next
worst, and so on. If you think that two (or more) people feel
equally bad, write the same number next to both their names.
Two different orderings of the versions (within each case) were
used.
2.2 Results
Mean ranks across subjects for the four versions in each of the
five cases are presented in Table 1. Friedman analysis of
variance for ranks reveals a significant difference between the
ranks of the four versions, for each of the cases (p < .01 for each
of the five tests). In all cases, SQ-NO is ranked higher than
CH-ACT. Sixteen subjects ranked the SQ-NO version higher than
the CH-ACT in most of the cases, while only one subject gave the
opposite ranking more often (p < .01). This result replicated
Kahneman and Tversky's finding that a bad outcome of action
results in worse feeling than an identical bad outcome with no
action involved
Table 1
Mean ranks (4=best) for the conditions of Experiment 1
(n=20)
Case
I II III IV V
flight stock course job cab
Version
SQ-NO 3.55 3.35 3.10 3.35 3.50
CH-ACT 2.00 2.05 2.10 2.05 1.75
CH-NO 2.05 2.20 1.95 2.30 2.15
SQ-ACT 1.60 1.40 1.55 1.40 1.65
The main finding of the present experiment concerns the
comparison of a change in state which does not involve action
(version CH-NO) and an action which is designed to keep the
status quo (version SQ-ACT). In all cases, CH-NO is ranked
higher than SQ-ACT. Fourteen subjects ranked CH-NO higher than
SQ-ACT in most cases, but only 4 subjects gave the opposite
ranking more often (p < .05). It seems that action, rather than
change of state, is producing the intensified feelings one
experiences when a bad outcome occurs.
It is apparent also that the two new cases (CH-NO and SQ-ACT), in
which a change must be accepted or rejected, are ranked lower
than the original two cases (SQ-NO and CH-ACT) used by Kahneman
and Tversky. Perhaps this result is explained by norm theory:
the opportunity to accept or reject a change makes the chosen
option seem closer to the forgone option. In these new cases,
the decision must (presumably) be made at a particular time,
because it is offered by another person. In the original cases,
the decision can be made at any time.
3 Experiment 2
In this experiment subjects were presented with a choice between
two alternatives varying on two dimensions. For example, the
university is giving loans to students, which are paid back out
of the student's salary after graduation. The two available
programs vary in the percent of salary and the number of years
over which payments are made.
The two factors that may bias decisions concerning change -
preference for the status quo and preference for inaction - were
orthogonally manipulated. We compared subjects' decisions in
pairs of situations which are similar with respect to one of
those factors but differ with respect to the other.
For example, the following two conditions are identical in terms
of which outcome would result from action (or inaction), but
differ with respect to which alternative is the status quo.
Status-quo B: B is the status quo. Omission will lead to B, but
action is required in order to choose A.
Change to B: A is the status quo. Nevertheless, omission will
lead to B (the status quo is about to be changed), and action is
required in order to keep A.
If subjects' choices of alternative A or B differ in those two
conditions, they must be affected by preference for the status
quo, rather than by preference for inaction.
As an example of a test of preference for inaction, compare
status-quo-B above to the following condition:
Change to A: B is the status quo. However, an omission will
lead to A, and action is required in order to keep B.
Since preference for the status quo alternative should lead to
choosing B in both status-quo-B and change-to-A, a subject who
makes a different choice in those two conditions can be affected
only by the action/inaction distinction.
For each problem, nine different versions were used. These are
described in Table 2. The nine versions give rise to six
independent comparisons in which preference for current state
could be tested, and six independent comparisons in which
preference for inaction could be tested. We hypothesize that
comparisons of the latter kind will yield more differences than
comparisons of the former kind.
3.1 Method
Subjects. 50 subjects were solicited as in the previous
experiment.
Stimulus Material. Five decision problems were employed in
this study. For each problem two alternatives were presented,
each varying along two dimensions. The five decisions concerned:
(A) University loans to students. Paying back varies in number
of years and percentage of income.
(B) Public library rules. These vary in the number of books that
can be taken out at one time, and the period of the loan (in
days).
(C) Checking accounts, varying in number of checks per month and
cost per check.
(D) Gift certificates for a restaurant. These vary in value and
in number of days before expiration.
(E) Medical insurance policies. varying in deductible sum and
co-insurance rate.
Although only the last decision involves explicit uncertainty, we
assume that the processes involved are similar across decisions
of different types, and uncertainty is involved implicitly in
other choices (e.g., in item A the desirability of the different
plans depends on one's future income, which is uncertain).
The nine versions of each problem are presented in Table 2.
Within each group of three versions (e.g., 1-3), the first
requires action for both options, the second requires action only
for one option, and the third requires action for the other
option. Versions 1-3 lack a status quo. The remaining versions
each have a status quo but differ in whether the status quo will
change without action or, alternatively, whether action is
required.
Table 2
Conditions of Experiment 2.
condition current action indicate
status quo alternative action by
1. - A , B < , >
2. - B a (for action)
3. - A a
4. A A , B < , >
5. A B c (for change)
6. A A o (object to change)
7. B A , B < , >
8. B B o
9. B A c
Procedure. Subjects first performed a matching task for
each of the problems, in which they matched alternative B to
alternative A by filling in a value for one of the dimensions of
B. The values of the matched alternatives were used in all
subsequent choice tasks. (Athough the options in the choices
were equated for desirability, subjects did not seem to have
difficulty in choosing. Indeed, Tversky, Sattath, and Slovic,
1988, have found that the preference order revealed by matching
does not coincide with the one revealed by choice. Thus, using
the values from the matching task in the choice task served only
to prevent large discrepancies in desirability rather than to
create indifferentiable options.) Subjects then went through
conditions 1 to 9. In each conditions all five problems were
presented.
Stimuli were presented by computer. Subjects indicated their
choice by pressing the corresponding key, as shown in Table 2.
The ` < ' and ` > ' keys were used for choices in which neither
option was the status quo. The inaction choice was always
indicated by pressing the space bar. The letters `c' and `o'
were used to indicate a change or an objection to a change,
respectively.
3.2 Results
Six pairs of conditions in which the status quo factor was
constant while the action factor changed served as a test for
omission bias: 1-2, 1-3, 4-5, 4-6, 7-8, 7-9. For example, a
preference for B in version 1 but A in version 2 indicates a
preference for omission. The six pairs of conditions in which
the action factor was held constant while the status-quo factor
changed were: 1-4, 1-7, 3-6, 3-8, 2-5, 2-9. For example, a
preference for B in version 1 but A in version 4 indicates a
status-quo bias.
Table 3
Results of Experiment 2 (n=50)
OM pairs % in the # SQ pairs % in the
displaying predicted displaying predicted
conflicting direction conflicting direction
choices choices
(out of 6) (out of 6)
Problem
1. 1.72 69 1.66 50
2. 1.50 69 1.64 56
3. 1.16 67 1.36 55
4. 1.20 73 1.80 43
5. 1.48 63 1.28 64
mean 1.49 72 1.55 51
Table 3 displays the average across subjects of the total number
of pairs (out of six pairs, for each problem) in which the action
factor changed and in which conflicting choices were made, and
the percentage of these pairs favoring omission (OM). OM was
significantly greater than 50% in all five cases (t=2.35, p < .01;
t=3.44, p < .01; t=2.46, p < .05; t=4.13, p < .01; t=2.04, p < .05, for
cases 1 through 5, respectively) as well as overall (t=5.70,
p < .001). OM was 67% for the conditions in which there was no
status quo (conditions 2 and 3), which is significantly grater
than 50% (t=3.17, p < .005), and OM was 71% for the conditions in
which there was a status quo (conditions 5, 6, 8, and 9; t=4.85,
p < .001). These two measures of OM did not differ (t=0.67).
(This implies that the omission bias here is not simply a result
of being reluctant to reverse a suggestion made by someone else.)
Similarly we computed, for each subject, the number of pairs in
which the status-quo factor changed and in which different
choices were made, and the percentage of these pairs (denoted SQ)
favoring the status quo. The averages of these measures are also
displayed in Table 3. SQ did not differ significantly from 50%
(t=.36, p=.722). SQ was significantly larger than 50% only in
case 5 (t=.03, p=.97; t=1.18, p=.24; t=.88, p=.38; t=-1.52,
p=.13; t=2.33, p=.02, for the five cases, respectively).
Although SQ was 62% (significantly greater than 50%, t=2.13,
p < .05) in the conditions in which there was no possibility of
omitting action (conditions 4 and 7), it was only 49% in those
conditions in which omission was possible (conditions 5, 6, 8,
and 9).
To compare the relative size of the status-quo bias and the
omission bias, we computed for each subject the difference
between OM and SQ. The average difference, across subjects, is
20%, which is significantly greater than zero (t=4.33, p < .001).
It seems, then, that subjects did indeed prefer the inaction
alternative, independent of whether inaction would lead to
keeping the status quo or not, but we find little evidence for a
status-quo bias.
4 Experiment 3
If status-quo bias depends on action, then it should not be found
in a matching task in which one of the options is designated as
the status quo. The present experiment tests this hypothesis.
Some of the choice conditions of the last experiment are
replicated in order to show that the procedure is sensitive.
The experiment consisted of four conditions. The first two were
matching tasks: in the first task, subjects matched alternative B
to alternative A by setting the value of one of B's dimensions;
in the second task, subjects did the same matching again, except
that they were told that A was the status quo. None of the
matching tasks involves an `action' factor - subjects were told
to make the two situations `equally attractive' - so, if the
status-quo bias is due to a tendency towards inaction, we expect
no difference between those two conditions.
The last two conditions consisted of choice tasks. In the third
condition subjects were asked to choose between alternative A and
B, which were equated for desirability on the basis of the
matching data from the first condition. The fourth condition
pitted the status-quo bias directly against the omission bias.
The subjects were told that alternative A is the current status
quo, but it is about to be changed (to alternative B), unless
they object to the switch. Here, the status-quo bias would lead
subjects to object to the change, but the omission bias would
lead them not to object. We hypothesize that subjects will fail
to object to a change from the preferred alternative to the less
preferred one more often then they object to a change from the
less preferred alternative to the more preferred one. (`More'
and `less' preferred are determined from the first choice task.)
4.1 Method
Twenty-five subjects were solicited as in the previous
experiments.
The same five cases were used as in the last experiment. Each
subject went through all versions of the five cases. For each
case, eight versions were used, two for each of the two
conditions: matching; matching with status quo; choice; choice
with change. These are displayed in Table 4. The values used in
the choice versions were taken from the results of the matching
versions, as indicated in the table. For example, the first
choice version and the first choice-with-change version took
their values from the first matching task, in which B was matched
to A.
Stimuli were presented on a computer screen, and the subjects
responded on the keyboard. For simple choice tasks, the
characters ` < ' and ` > ' were used to indicate the left- and
right-hand choice, respectively, and the letter `o' was used to
object to the change in the choice-with-change condition. The
space bar was used to accept the choice.
Table 4
Conditions of Experiment 3.
Condition task SQ dimension values indicate
(version) from version action by
1. match B to A -
2. match A to B -
3. match B to A A
4. match A to B B
5. chose A or B - 1 < , >
6. chose A or B - 2 < , >
7. decide whether to
object to change
from A to B A 1 o(object)
8. decide whether to
object to change
from B to A B 2 o(object)
Note: The column labeled `dimension values from version'
indicates the version from which the dimension values were taken.
'<' and `>' indicate the keys to be pressed to indicate the
choice of A or B, respectively.
4.2 Results
To examine the effect of having a status quo option in a matching
task, we computed for each subject the difference between the
matching response in versions with a specified status-quo option
and the matching response to the same cases when no status quo
was mentioned. Thus, ten difference scores were computed, two
for each case. Averaging across subjects, we find that only one
of these ten scores is significantly different from zero. (In
addition, for each subject, we counted the number of times that
the response to the matching with status quo was greater than the
response for the corresponding matching without status quo, and
the number of times the opposite order was found. 13 subjects
showed more positive differences, and 10 subjects showed more
negative differences. This difference is also not significant.)
Having one of the options as a status quo does not seem to affect
subjects in matching two options.
To determine whether the experiment was sensitive, we tested the
hypothesis that omission bias was more frequent than status-quo
bias in choice by comparing versions 7 and 8 with versions 5 and
6. In comparing version 7 with version 5, status-quo bias
occurred when the subject chose B in version 5 but then objected
to a change from A to B in version 7. Likewise, omission bias
occurred when the subject chose A in version 5 but then failed to
object to a change from A to B in version 7. (For versions 6 and
8, the A's and B's are reversed.) To compare the two biases, we
compared two proportions. One, representing status-quo bias, is
the number of cases in which the subject chose B in version 5 and
then objected to the change to A in version 7 (or chose A in
version 6 and objected in version 8) divided by the number of
cases in which the subject chose B in version 5 (or A in version
6). The other proportion, representing omission bias, was the
number of cases in which the subject chose A in version 5 and
failed to object to the change to B in version 7 (or chose B in
version 6 and failed to object in version 8) divided by the
number of cases in which the subject chose A in version 5 (or B
in version 6). The mean of the proportion representing omission
bias was 27%, but the mean of the proportion representing
status-quo bias was 10%. The difference was highly significant
(t=3.95, p < .001).
5 Discussion
The results of all three experiments are summarized in Table 5.
Omission bias was found in choice whether the status quo was
changed by action or not, but, when action was equated, no
consistent status-quo bias was found. Likewise, no status-quo
bias was found when subjects matched outcomes instead of
choosing. (Although Viscusi et al., 1987, and others used tasks
that looked like matching, they could also be seen as a form of
choice, e.g., `How much money would you accept to bear this
risk?' rather than `What monetary gain would be equally
attractive to losing the risk?') These findings support previous
demonstrations of omission bias (Spranca et al., in press; Ritov
& Baron, in press), and they suggest that omission bias plays a
major role in status-quo bias. The findings have other
implications concerning the status-quo bias.
Table 5
Summary of results
Experiment
and measure Conditions compared Subjects favor
----------------------------------------------------------------
1. Emotion Status-quo-omit vs. change-act Status-quo-omit
Status-quo-act vs. change-omit Change-omit
2. Choice Omit vs. act Omit
Status-quo vs. change No difference
3. Matching Status-quo vs. no-status-quo No difference
Choice Status-quo-act vs. change-omit Change-omit
Our findings are fully consistent with the norm-theory account as
proposed by Kahneman and Miller (1986): omissions tend to be
considered as the norm, and commissions tend to be compared to
what would have happened if nothing had been done. Omissions
therefore tend to be evaluated as `neutral' regardless of their
outcome, while commissions are evaluated as positive if their
outcomes are better and negative if their outcomes are worse than
the presumed outcome of inaction.
Our findings can also be reconciled with the standard
interpretation of the status-quo bias in terms of loss aversion,
but only if we assume that the reference point is omission rather
than the status quo. By this account, negative consequences of
the commission are weighed more heavily than positive
consequences of the commission, regardless of the status quo. It
is also possible, however, that loss aversion is itself limited
to cases in which losses are caused by action. (The obvious
exception here is our desire to rid ourselves of gambles with
zero expected value, but this single phenomenon might be due to
some other source of risk aversion.)
Although the major accounts of the status-quo bias are not
seriously affected by our findings, other possible accounts are
brought into question. In particular, the bias cannot now be
fully explained in terms of factors that cause an attachment to
the status quo, e.g., familiarity or fear of the unknown. One
such factor is adaptation to the status quo, which has been
claimed to be a major factor in producing a reference point
(Kahneman & Varey, 1989). On the other hand, these factors might
still operate in situations in which subjects had more chance to
acquaint themselves with the status quo than they did in our
hypothetical scenarios. But note that some previous
demonstrations of the status-quo bias do not give subjects a
chance to adapt, even though real rather than hypothetical
decisions are made (Knetsch et al., 1988).
Spranca et al. propose other explanations of omission bias, which
could be operating here. Subjects could hold themselves
responsible for the negative consequences of commissions but not
for those of omissions. This difference in responsibility, in
turn, seems often to be supported by the belief that actors do
not cause the outcomes of their omissions, for these outcomes
would have occurred if the actor were absent or if the actor did
not know of the possibility of affecting the outcome. Spranca et
al., following Bennett (e.g., 1966, 1981), argue that this belief
in non-causality is an illusion, for what matters is the
alternative options known to be available.
Preference for the omission option may also result from
unwillingness to choose between the available options. In some
cases, this could simply reflect a measure for reducing
processing load. A `perfectly rational' utility maximizer should
continually weigh other options against the status quo state,
from possession of personal belongings to remaining in present
employment. For most people this is an unbearable task.
Foregoing choice by preferring the omission option is a way of
reducing the number of decisions for which weighing and
comparison of utilities is unavoidable. Note, however, that in
these experiments, subjects have elevated this principle to the
level of a rule of behavior. The effort of making the decision
is required by the experiment and is therefore equal in all
conditions.
Our findings have some practical implications. First, they
suggest that status-quo biases can be counteracted by changing
the way in which options are presented to a decision maker. When
both keeping and changing the status quo require action, people
will be less inclined to err by favoring the status quo when it
is worse. Some recognition of the role of omission bias is found
in laws or rules that require specific actions to be renewed
after some period of time, or in general `sunset' laws, but these
laws may go too far in opposing the status quo (unless that is
desired as a self-control strategy for the rule makers). A more
neutral option would be to require a decision either way.
A second implication concerns the measurement of values.
Findings of differences between willingness-to-pay and
willingness-to-accept, which prevent the measurement of values
for public goods and other goods, might be reduced or eliminated
by procedures that equate the degree of action, even though one
of the options is in fact the status quo.
6 References
Baron, Jonathan (1988). Thinking and deciding. New York:
Cambridge University Press.
Bennett, Jonathan. (1966). `Whatever the consequences.'
Analysis, 26, 83-102 (reprinted in B. Steinbock, ed.,
Killing and letting die, pp. 109-127. Englewood Cliffs, NJ:
Prentice Hall).
Bennett, Jonathan. (1981). `Morality and consequences.' In S.
M. McMurrin (Ed.), The Tanner Lectures on human values (vol.
2, pp. 45-116). Salt Lake City: University of Utah Press.
Kahneman, Daniel, & Dale T. Miller. (1986). `Norm theory:
Comparing reality to its alternatives.' Psychological
Review, 93, 136-153.
Kahneman, Daniel, & Amos Tversky. (1982). `The psychology of
preferences.' Scientific American, 246, 160-173.
Kahneman, Daniel, & Amos Tversky. (1984). `Choices, values, and
frames.' American Psychologist, 39, 341-350.
Kahneman, Daniel & C. Varey. (1988). Notes on the psychology
of utility. Paper presented at the Conference on Interpersonal
Comparisons of Utilities, University of Chicago, May 1988.
Knetsch, Jack L., Richard H. Thaler, & Daniel Kahneman. (1988).
Experimental tests of the endowment effect and the Coase
theorem. Manuscript, Department of Economics, Simon Fraser
University.
Landman, Janet. (1987). `Regret and elation following action and
inaction: Affective responses to positive versus negative
outcomes.' Personality and Social Psychology Bulletin, 13,
524-536.
Ritov, Ilana, & Jonathan Baron. (in press). Reluctance to
vaccinate: Commission bias and ambiguity. Journal of
Behavioral Decision Making.
Ritov, Ilana, Joel Hodes, & Jonathan Baron (1989). Biases in
decisions about compensation for misfortune. Manuscript,
Department of Psychology, University of Pennsylvania.
Samuelson, William, & Richard Zeckhauser. (1988). Status-quo
bias in decision making. Journal of Risk and Uncertainty,
1, 7-59.
Spranca, Mark, Elisa Minsk, & Jonathan Baron. (in press).
Omission and commission in judgment and choice. Journal of
Experimental Social Psychology.
Thaler, Richard. (1980). Toward a positive theory of consumer
choice. Journal of Economic Behavior and Organization, 1,
39-60.
Tversky, Amos, Shmuel Sattath, & Paul Slovic. (1988). Contingent
weighting in judgment and choice. Psychological Review, 95,
371-384.
Viscusi, W. Kip, Wesley A. Magat, & Joel Huber (1987). An
investigation of the rationality of consumer valuation of
multiple health risks. Rand Journal of Economics, 18,
465-479.
Footnotes:
1This work was
supported by a grant from the National Science Foundation
(SES-8809299). We thank the reviewer for helpful comments.
File translated from
TEX
by
TTH,
version 3.59.
On 9 Jun 2004, 06:56.