Analysis of Individual Behaviour based on Status Quo Bias

Abstract

Status quo bias describes a behavioural tendency which occurs disproportionately often when individuals make their decisions, individuals under this influence will prefer to select a previously chosen alternative or an option which maintains the status quo. This paper discusses the mechanism and the factors influencing the status quo bias. We found that the mechanism could possibly be interpreted by the three psychological principles: loss aversion, regret theory, and anchoring effect. Then this paper discusses factors that may influence the status quo bias which include emotions and satisfaction of the decision-maker as well as the number of alternatives. The results show that the status quo bias will occur only when the individual is satisfied with the current situation, and they will tend to choose the status quo option when facing more choices. This research could be used to better analyse individuals and organisations when they make decisions in wider areas.