What is Status-Quo Bias?

Many individuals dread change. Therefore, they will go through any process to prevent change from occurring. The reason why an individual may do so depends on several factors. Instead of welcoming change, these people will try to ensure things remain the same way. When these changes do occur, they view it as a loss or evil. This preference of things staying the same can lead to a bias in decision-making.

What is Status-Quo Bias?

Status-quo bias is a type of influence that individuals get from preferring stability over change. As mentioned, when choosing between change and conservation, they will always opt for the former. For most individuals, change comes with uncertainty, which they may not like. Instead, they strive to ensure things remain the same for the longest possible time.

Status-quo bias comes as a direct result of being resistant to change. In any decision-making process, change is inevitable. However, individuals will always prefer a course that ensures there is no or minimum change involved. This way, they may end up making decisions that can lead to losses in the future. Overall, status-quo bias can lead to irrational decision-making.

How does Status-Quo Bias work?

Status-quo bias comes as a direct result of the change. Therefore, any process that involves change also includes the status-quo bias. The term status-quo bias comes from the work of William Samuelson and Richard Zeckhauser. They conducted various experiments which suggest that people show a substantial preference for choices that maintain the status quo.

The research also suggests that when faced with critical decisions, people will prefer certainty. Therefore, they will always choose a decision that does not involve any change. While doing so can make the process shorter and more manageable for individuals, it also implies they may compromise their decision-making.

Status-quo bias can entice individuals to make decisions that aren’t in their best interest. By sticking to stability, individuals also sacrifice the opportunities that present themselves through change. Usually, individuals establish a default state, which they consider stable. If any decision alters this state, they will likely oppose it despite it being more reasonable.

How to avoid Status-Quo Bias?

Like any other type of bias recognized by behavioural finance, individuals can avoid the status-quo bias by understanding how it works. Similarly, by weighing all available options against each other and considering them objectively, individuals can reach better decisions. This way, they can avoid sticking to a default state and welcome change that accompanies opportunities.

Similarly, having a plan or course of action can help in avoiding status-quo bias. This way, individuals can see the overall picture of how decisions will impact them. Furthermore, if individuals consider the losses associated with stability, they can make more informed decisions. Overall, status-quo bias is avoidable and can result in higher returns.

Why is Status-Quo Bias important?

Status-quo bias is important because it prevents individuals from welcoming change. Therefore, it can lead to missing out on new opportunities and sticking to a default state. Understanding this bias can help individuals prevent it from occurring. This way, they don’t neglect any potential returns that they can get from otherwise embracing change.


Status-quo bias is the type of bias that tempts individuals to prevent change from occurring. Instead, it forces them to stick to a default state. Status-quo bias can impact individuals’ decisions and lead to missed opportunities. Understanding this bias and how it works is crucial for individuals as it can help them avoid it.

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