Decisions among defaults and the effect of the option to do nothing

Sibilla Di Guida, Davide Marchiori and Ido Erev

Economics Letters, 2012, vol. 117, issue 3, 790-793

Abstract: This paper examines the effect of default options on choice behavior in experience-based decisions. To this end, we designed the “radio-button” experimental paradigm, in which participants are asked to set default options that remain effective until they decide to change them, and the outcomes from active and inactive options are determined and presented to participants every two seconds. Comparison of behavior in six basic decision problems run under the “clicking” and “radio-button” experimental paradigms reveals an unexpected result. We find that, although the basic properties of decisions from experience are robust to the option to rely on self-set defaults, the introduction of defaults reduces the tendency to prefer the status quo. We dub this behavioral pattern as the “do something” effect.

Keywords: Default options; Rare events; Decisions from experience; Clicking paradigm; Status quo (search for similar items in EconPapers)
JEL-codes: C91 D81 D83 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:117:y:2012:i:3:p:790-793

DOI: 10.1016/j.econlet.2012.08.018

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