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Status Quo Bias

Edited by Paweł Raja, PhD · Published

Definition

Status Quo Bias is a preference for keeping things as they are, so that the current state of affairs is chosen more often than an equally good or better alternative simply because it is the current state.

Also known as:
Status quo effect, Preference for the status quo
Category:
Decision Architecture
Impact:
High
Landmark study:
Samuelson & Zeckhauser (1988)
Evidence here:
2 field findings, 7 cited studies

Why it happens: the psychology of status quo bias

Samuelson and Zeckhauser (1988) coined the term. In experiments where participants made hypothetical investment and job choices, an option was chosen far more often when it was described as the existing state of affairs than when the same option was presented as one new alternative among several. They found the same pattern in real choices of health plans and retirement funds.

Kahneman, Knetsch and Thaler (1991) linked status quo bias to loss aversion and the endowment effect: the current position is the reference point, so the disadvantages of leaving it loom larger than the advantages.

Other contributors are the effort of switching, uncertainty about the alternative, and anticipated regret — a bad outcome feels worse if you caused it by changing something.

A natural experiment in US car insurance showed the stakes. New Jersey's default was a cheaper policy with a limited right to sue; Pennsylvania's default was the full right. Most drivers in each state kept their own state's default (Johnson, Hershey, Meszaros and Kunreuther, 1993).

Status Quo Bias examples

When New Jersey and Pennsylvania offered drivers the same two car-insurance options with opposite defaults, most drivers in each state stayed with whichever option was their state's default.

  • Staying on the same energy tariff, bank account or phone contract for years even when cheaper alternatives exist.
  • Employees keep the health plan or pension fund they first chose, rarely revisiting it as their circumstances change.
  • Organizations keep legacy processes because 'that's how we've always done it'.

How to avoid status quo bias

  1. Reverse the question. Imagine you already had the alternative: would you switch to what you have now? If not, staying put is a choice, not a neutral default.
  2. Put recurring reviews in the calendar for contracts, subscriptions and investments.
  3. Count the cost of doing nothing explicitly, so that inaction is compared on equal terms with change.

How to design for it (nudge strategy)

Prompt periodic active choices (e.g. annual plan reviews with a side-by-side comparison), and when setting the status quo, make it the option most people would choose on reflection.

Ethical use: design for choices people would endorse on reflection — a nudge, not sludge. Be transparent and keep opting out easy.

The evidence (2)

Key studies

  1. Options framed as the status quo were chosen disproportionately in experiments and in real health-plan and pension choices.

    Samuelson, W., & Zeckhauser, R. (1988). Status quo bias in decision making. Journal of Risk and Uncertainty, 1(1), 7–59. DOI →

  2. Tied status quo bias to loss aversion and the endowment effect.

    Kahneman, D., Knetsch, J. L., & Thaler, R. H. (1991). Anomalies: The endowment effect, loss aversion, and status quo bias. Journal of Economic Perspectives, 5(1), 193–206. DOI →

  3. Drivers in New Jersey and Pennsylvania overwhelmingly kept their state's default insurance option.

    Johnson, E. J., Hershey, J., Meszaros, J., & Kunreuther, H. (1993). Framing, probability distortions, and insurance decisions. Journal of Risk and Uncertainty, 7(1), 35–51. DOI →

  4. Workers stayed with whatever enrollment, contribution rate and fund the plan set for them.

    Madrian, B. C., & Shea, D. F. (2001). The power of suggestion: Inertia in 401(k) participation and savings behavior. Quarterly Journal of Economics, 116(4), 1149–1187. DOI →

Key research

Related biases

IKEA EffectDefault EffectAnchoring BiasFraming Effect

Status Quo Bias: frequently asked questions

What is status quo bias?

Status quo bias is the preference for keeping things the way they are, so that the current option is chosen more often than alternatives that are just as good or better.

What is an example of status quo bias?

Staying on an expensive phone contract or energy tariff for years, keeping the first pension fund you were given, or sticking with a default insurance policy.

What causes status quo bias?

Loss aversion (giving up the current option feels like a loss), the effort and uncertainty of switching, and anticipated regret if a change turns out badly.

What is the difference between status quo bias and the default effect?

Status quo bias is the general preference for the current state; the default effect is that preference applied to a pre-selected option someone else designed.

Cite this page

Raja, P. (Ed.). (2026, 8 Oct 2026). Status Quo Bias. Behavioral Economics Lab. https://www.behavioraleconomicslab.com/biases/status-quo-bias

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