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Status quo maintenance reconsidered: changing or incomplete preferences?

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  • Michael Mandler

Abstract

After reviewing the evidence for status quo maintenance (SQM), I consider how to reconcile SQM with traditional consumer theory. Behavioural economists usually let agents' preferences change as a function of their endowments, treating the same person with different endowments as a set of distinct agents. Many properties of preferences then become immune to empirical test and it becomes impossible to judge whether an agent's decisions make the agent better or worse off. This impedes prediction of when decision rules are likely to change. SQM can alternatively be explained with unchanging preferences if preferences are incomplete. SQM is then consistent with self-interest and there is no reason why it should not persist. Copyright 2004 Royal Economic Society.

Suggested Citation

  • Michael Mandler, 2004. "Status quo maintenance reconsidered: changing or incomplete preferences?," Economic Journal, Royal Economic Society, vol. 114(499), pages 518-535, November.
  • Handle: RePEc:ecj:econjl:v:114:y:2004:i:499:p:f518-f535
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    Cited by:

    1. Wiebke Roß & Jens Weghake, 2018. "Wa(h)re Liebe: Was Online-Dating-Plattformen über zweiseitige Märkte lehren," TUC Working Papers in Economics 0017, Abteilung für Volkswirtschaftslehre, Technische Universität Clausthal (Department of Economics, Technical University Clausthal).
    2. Georgios Gerasimou, 2016. "Asymmetric dominance, deferral, and status quo bias in a behavioral model of choice," Theory and Decision, Springer, vol. 80(2), pages 295-312, February.
    3. Georgios, Gerasimou, 2013. "A Behavioural Model of Choice in the Presence of Decision Conflict," SIRE Discussion Papers 2013-25, Scottish Institute for Research in Economics (SIRE).
    4. Apesteguia, Jose & Ballester, Miguel A., 2013. "Choice by sequential procedures," Games and Economic Behavior, Elsevier, vol. 77(1), pages 90-99.
    5. Handfield, Toby, 2013. "Rational choice and the transitivity of betterness," MPRA Paper 49956, University Library of Munich, Germany.
    6. Christoph Engel & Svenja Hippel, 2017. "Experimental Social Planners: Good Natured, but Overly Optimistic," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2017_23, Max Planck Institute for Research on Collective Goods.
    7. Gerasimou, Georgios, 2012. "Asymmetric Dominance, Deferral and Status Quo Bias in a Theory of Choice with Incomplete Preferences," MPRA Paper 40097, University Library of Munich, Germany.
    8. Andrea Isoni & Graham Loomes & Robert Sugden, 2009. "The willingness to pay-willingness to accept gap, the "endowment effect," subject misconceptions, and experiemntal procedures for eliciting valuations: A reassessment," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 09-14, School of Economics, University of East Anglia, Norwich, UK..
    9. Bosi, Gianni & Herden, Gerhard, 2012. "Continuous multi-utility representations of preorders," Journal of Mathematical Economics, Elsevier, vol. 48(4), pages 212-218.
    10. Kim Kaivanto, 2017. "Ensemble prospectism," Theory and Decision, Springer, vol. 83(4), pages 535-546, December.
    11. Andrea Isoni & Graham Loomes & Robert Sugden, 2011. "The Willingness to Pay—Willingness to Accept Gap, the "Endowment Effect," Subject Misconceptions, and Experimental Procedures for Eliciting Valuations: Comment," American Economic Review, American Economic Association, vol. 101(2), pages 991-1011, April.
    12. Donald Wittman, 2008. "Is Status Quo Bias Consistent With Downward-Sloping Demand?," Economic Inquiry, Western Economic Association International, vol. 46(2), pages 283-288, April.
    13. Brown, Thomas C. & Morrison, Mark D. & Benfield, Jacob A. & Rainbolt, Gretchen Nurse & Bell, Paul A., 2015. "Exchange asymmetry in experimental settings," Journal of Economic Behavior & Organization, Elsevier, vol. 120(C), pages 104-116.
    14. Mandler, Michael, 2009. "Indifference and incompleteness distinguished by rational trade," Games and Economic Behavior, Elsevier, vol. 67(1), pages 300-314, September.
    15. Mehmet Karacuka & Asad Zaman, 2012. "The empirical evidence against neoclassical utility theory: a review of the literature," International Journal of Pluralism and Economics Education, Inderscience Enterprises Ltd, vol. 3(4), pages 366-414.
    16. Mandler, Michael, 2014. "Indecisiveness in behavioral welfare economics," Journal of Economic Behavior & Organization, Elsevier, vol. 97(C), pages 219-235.
    17. Mandler, Michael, 2005. "Incomplete preferences and rational intransitivity of choice," Games and Economic Behavior, Elsevier, vol. 50(2), pages 255-277, February.
    18. Elena Cettolin & Arno Riedl, 2015. "Revealed Incomplete Preferences under Uncertainty," CESifo Working Paper Series 5359, CESifo Group Munich.
    19. Costa-Gomes, Miguel & Cueva, Carlos & Gerasimou, Georgios, 2014. "Choice, Deferral and Consistency," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon TN 2015-17, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    20. Miguel Costa-Gomes & Carlos Cueva & Georgios Gerasimou & Matus Tejiscak, 2014. "Choice, Deferral and Consistency," Discussion Paper Series, Department of Economics 201416, Department of Economics, University of St. Andrews, revised 26 Dec 2016.
    21. Andrea Isoni, 2011. "The willingness-to-accept/willingness-to-pay disparity in repeated markets: loss aversion or ‘bad-deal’ aversion?," Theory and Decision, Springer, vol. 71(3), pages 409-430, September.
    22. Masatlioglu, Yusufcan & Uler, Neslihan, 2013. "Understanding the reference effect," Games and Economic Behavior, Elsevier, vol. 82(C), pages 403-423.
    23. Frondel, Manuel & Sommer, Stephan, 2017. "Der Wert von Versorgungssicherheit mit Strom: Evidenz für deutsche Haushalte," RWI Materialien 115, RWI - Leibniz-Institut für Wirtschaftsforschung.
    24. Gerasimou, Georgios, 2015. "Indecisiveness, Undesirability and Overload Revealed Through Rational Choice Deferral," MPRA Paper 67290, University Library of Munich, Germany.

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