Disentangling Status Quo and Omission Effects: An Experimental Analysis

Abstract

The status quo bias as described by Samuelson and Zeckhauser (1988) can be decomposed into two primary effects-an exaggerated preference for the current or previous state of affairs and an exaggerated preference for inaction. We describe an experiment designed to disentangle these effects. Analysis of results shows that both effects can occur, they appear to be additive, and subjects exhibit these effects unknowingly. These effects relate to and may interact with loss aversion, ambiguity, and regret. © 1994 by Academic Press, Inc.