Default effect

The default effect, a concept within the study of nudge theory, explains the tendency for an agent to generally accept the default option in a strategic interaction.^[1] The default option is the course of action that the agent, or chooser, will obtain if he or she does not specify a particular course of action.^[2] The default effect has broad applications for firms attempting to 'nudge' their customers in the direction of the firm's optimal outcome. Experiments and observational studies show that making an option a default increases the likelihood that such an option is chosen.^[3] There are two broad classes of defaults: mass defaults and personalised defaults.^[4] Setting or changing defaults has been proposed and applied by firms as an effective way of influencing behaviour—for example, with respect to setting air-conditioner temperature settings, giving consent to receive e-mail marketing, or automatic subscription renewals.

^ Altman, Morris (2017). "Aspects of Smart Decision-Making". Handbook of Behavioural Economics and Smart Decision-Making: 155–156. doi:10.4337/9781782549598. ISBN 9781782549598.
^ Herrmann, Andreas; Goldstein, Daniel G.; Stadler, Rupert; Landwehr, Jan R.; Heitmann, Mark; Hofstetter, Reto; Huber, Frank (2011-11-01). "The effect of default options on choice—Evidence from online product configurators". Journal of Retailing and Consumer Services. 18 (6): 483–491. doi:10.1016/j.jretconser.2011.06.005. ISSN 0969-6989.
^ "Do you need a nudge?". Yale Insights. Retrieved 2021-04-22.
^ "Nudge Your Customers Toward Better Choices". Harvard Business Review. 2008-12-01. ISSN 0017-8012. Retrieved 2021-04-22.

[1] Altman, Morris (2017). "Aspects of Smart Decision-Making". Handbook of Behavioural Economics and Smart Decision-Making: 155–156. doi:10.4337/9781782549598. ISBN 9781782549598.

[2] Herrmann, Andreas; Goldstein, Daniel G.; Stadler, Rupert; Landwehr, Jan R.; Heitmann, Mark; Hofstetter, Reto; Huber, Frank (2011-11-01). "The effect of default options on choice—Evidence from online product configurators". Journal of Retailing and Consumer Services. 18 (6): 483–491. doi:10.1016/j.jretconser.2011.06.005. ISSN 0969-6989.

[3] "Do you need a nudge?". Yale Insights. Retrieved 2021-04-22.

[:0-4] "Nudge Your Customers Toward Better Choices". Harvard Business Review. 2008-12-01. ISSN 0017-8012. Retrieved 2021-04-22.

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