The Great Power of Defaults

December 30, 2007 | By | 13 Replies More

In an article entitled “When Words Decide,” Barry Schwartz (writing in the August/September 2007 edition of Scientific American Mind [not available online]) gives some good examples demonstrating the great power of default choices.  These examples add more fuel for a long burning fire-that people are not the rational careful-thinking beings (homo economicus) economists have traditionally portrayed them to be.

One example is that 90% of the people in most European countries are organ donors.  Compare that number to the lowly 25% of Americans who agree to donate their organs.  Why the difference?  As reported by Eric Johnson and Daniel Goldstein of the London business school (in 2003), one is deemed to be an organ donor in Europe.  In the United States, to be an organ donor, you have to sign the back of your driver’s license.  In the U.S., if you don’t sign the back of the driver’s license, you cannot be considered to be an organ donor.

Schwartz gives another good example.  When employers switch their 401(k) plans from opt-in (where you have to sign a form to contribute) to opt-out (or you have to sign a form to decline participation) “initial enrollment jumped from 49 to 86%.  This was according to a 2001 study by University of Pennsylvania economist Brigitte Madrian.

No-fault insurance provides yet another example.  No-fault is the default in New Jersey.  In Pennsylvania, however, citizens must opt-in.  As reported in the Journal of Risk and Uncertainty in 1993, 80% of car owners in the states ended up with the default choice (which cost Pennsylvanians millions of dollars.

Defaults have great power, and Schwartz suggests that it may come from lack of human attention.

Life is busy and complicated and it is not possible to pay attention to everything.  That is why most of us keep our cell phone plan whether or not it is the best one for us.  Researching alternatives is time-consuming and we do not want to be bothered.

I am a big believer in limited human attentional capacities as explanatory causes for much human behavior.  See here, for example.

But there’s more.  University of California psychologist Craig McKenzie conducted a study on which found that most people simply infer that the default choice is the best option.

Given this power of defaults, politicians might well be tempted to nudge people in various directions based upon the use of default choices, a technique that economist Richard Thaler terms “libertarian paternalism.”

I’m wondering the extent to which this principle might apply in the political realm.  Are we so accepting of the our financially corrupted election system, for example, because it is handed to us as the default system (one alternative being the write in ballot and another being revolution)?

Share

Tags: , , ,

Category: American Culture, Psychology Cognition

About the Author ()

Erich Vieth is an attorney focusing on consumer law litigation and appellate practice. He is also a working musician and a writer, having founded Dangerous Intersection in 2006. Erich lives in the Shaw Neighborhood of St. Louis, Missouri, where he lives half-time with his two extraordinary daughters.

Comments (13)

Trackback URL | Comments RSS Feed

  1. I'm somewhat confused regarding the 90% organ donors in most European countries. Does that mean 90% of the population are registered as organ donors by default?

  2. Erich Vieth says:

    proj: The article indicated that 90% of Europeans have not opted-out of being donors. According to the article, all Europeans are, by default, donors. Europeans have to fill out a form to NOT be donors, whereas Americans must affirmatively declare themselves to be donors, or else, by default, they aren't donors.

  3. I find this claim to be somewhat strange when they say "all Europeans". It is certainly not the case in Germany, where you do have to register as a donor. I happened to read a review today about the interesting news tidbits in 2007. There was also the question if after the Dutch TV show Donorshow the number of registered organ donors in Germany has risen. The answer from some health department was that about 12% of Germans have an organ donor passport. <a href="http://www.inthenews.co.uk/news/autocodes/countries/netherlands/donorshow-was-hoax-$1093367.htm&quot; rel="nofollow">Donorshow was a Dutch reality TV program in which a woman's kidneys were promised to the winner among the three contestants. It was a hoax to raise awareness regarding this issue. Brits also have to register: <a href="http://www.bbc.co.uk/health/donation/factfilesod_comparisons.shtml&quot; rel="nofollow"&gt <a href="http://;http://www.bbc.co.uk/health/donation/factfilesod_comparisons.shtml” target=”_blank”>;http://www.bbc.co.uk/health/donation/factfilesod_comparisons.shtml
    So, in at least three European countries people are not by default organ donors. I find statements that say "all Europeans" in general to be kind of untrustworthy. There are dozens of countries here with all kinds of different laws and regulations. And in general a percentage of 90% strikes me as too much for anything. I would doubt a consensus of 90% on any topic or a any kind of characteristic that 90% of the population in common (ok, maybe genetic factors) or like in this case that an altruistic 90% are willing to stay organ donors as this would mean that only 10% would choose to opt out. 90% happens, but it's rare.

  4. Sorry, I don't trust this piece of information at all as you can see. 😀

  5. Vicki Baker says:

    OK guys, once we take out religion, can we reform the way the research results are shared with the public? The current system, where actual research is behind subscription firewalls, and the research is publicized by PR hacks who summarize abstracts in a way that is most likely to get coverage (ie sensationalized) and then written up by journalists who may or may not have any background in science or statistics, is just not working.

    I googled Johnson and Goldstein and found their article right away, but it was behind a subscription wall. However, by adding some more search terms I found this <a> pdf version of the article.

    The data projektleiterin wants is on p. 2, which has a table of European countries, whether donation is opt in or opt out, and the consent rates. Austria, Belgium, France, Spain, and a bunch more are opt in; Germany, UK, Denmark, Ireland, and Netherlands are opt out. For all the opt-out (default consent) countries, the consent rate is actually over 99%, except for Sweden, which is 91.73.

  6. Vicki Baker says:

    "Austria, Belgium, France, Spain, and a bunch more are opt in; Germany, UK, Denmark, Ireland, and Netherlands are opt out."

    Scratch that, reverse it:

    Austria, Belgium, France, Spain, and a bunch more are opt out (default consent); Germany, UK, Denmark, Ireland, and Netherlands are opt in (signed consent form required).

  7. The cynical way to see this is simple: in the U.S. if it doesn't concern what you're going to do this evening or tomorrow night, most people don't want to be bothered.

    But I'm not quite that cynical…yet.

  8. Thanks Vicky for looking it up! Something happened to the link with the pdf though.

    I'm absolutely surprised about the consent rate of 99%. Or maybe the power of default is indeed very strong. It takes a lot of effort to raise public awareness about the problem with the lack of organs and to get people to register as organ donors. If you didn't do anything the percentage would also probably be quite low.

  9. Dan Klarmann says:

    Here's the Johnson and Goldstein Science Magazine article: <a rel="nofollow" target="_blank" href="http://www.dangoldstein.com/papers/DefaultsScience.pdf">"Defaults Save Lives" (pdf) on Goldstein's own site.

  10. Vicki Baker says:

    Projektleyterin: whi does everione spell my name with a "y" at the end? 🙁

  11. Ooops, sorry, Vicki! I really always make an effort to spell people's name right, because I hate that people will always spell mine wrong (or jump to conclusion about what is the first name and what the last name or simply assume I'm a guy).

  12. Vicki Baker says:

    That's okai, Y stylll lyke iou! 🙂

  13. Erich Vieth says:

    The UK's organ donor system is in need of an overhaul.   The PM "introduced the idea that perhaps it should be based on presumed consent, where everyone is automatically a donor, and when they die their organs are presumed to be available for donation, unless they opted out while still alive. . . More than 1,000 Britons die every year waiting for a new organ." http://www.medicalnewstoday.com/articles/93864.ph

Leave a Reply