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Default Effect: Definition, Examples and Effects

The default effect is a phenomenon in which people tend to stick with the default option when presented with a choice. This effect is based on the idea that people are more likely to choose the option that requires the least amount of effort or thought. It is a form of cognitive bias that can lead to people making decisions that are not necessarily in their best interest.


Examples of Default Effect:


One of the most common examples of the default effect is when people are presented with a choice between two different retirement plans. If one of the plans is the default option, people are more likely to choose it over the other plan, even if the other plan may be more beneficial for them in the long run. Another example is when people are presented with a choice between two different types of insurance plans. If one of the plans is the default option, people are more likely to choose it over the other plan, even if the other plan may be more beneficial for them in the long run.


Effects of Default Effect:


The default effect can have a significant impact on people’s decisions and can lead to people making decisions that are not necessarily in their best interest. For example, if people are presented with a choice between two different retirement plans and one of the plans is the default option, people are more likely to choose it over the other plan, even if the other plan may be more beneficial for them in the long run. This can lead to people making decisions that are not in their best interest and can have a negative impact on their financial future. Additionally, the default effect can lead to people making decisions that are not in line with their values or beliefs. For example, if people are presented with a choice between two different types of insurance plans and one of the plans is the default option, people are more likely to choose it over the other plan, even if the other plan may be more in line with their values or beliefs.


Do you want to expand your knowledge on this topic? Read our full in-depth article on cognitive biases.


Do you have extra 15 minutes today? Takeour fun and interactive quiz to learn which of 16 reasoning styles you use, your overall level of rationality, and what you can do now to improve your rationality skills.

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