Defaults and Attention: The Drop Out Effect
When choice options are complex, policy makers may seek to reduce decision making errors by making a high quality option the default. We show that this positive effect is at risk because such a policy creates incentives for decision makers to "drop out" by paying no attention to the decision and accepting the default sight unseen. Using decision time as a proxy for attention, we confirm the importance of this effect in an experimental setting. A key challenge for policy makers is to measure, and if possible mitigate, such drop out behavior in the field.
|Date of creation:||Apr 2012|
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- Patrick Bolton & Antoine Faure-Grimaud, 2009.
"Thinking Ahead: The Decision Problem,"
Review of Economic Studies,
Oxford University Press, vol. 76(4), pages 1205-1238.
- Gabriel D. Carroll & James J. Choi & David Laibson & Brigitte Madrian & Andrew Metrick, 2005.
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NBER Working Papers
11074, National Bureau of Economic Research, Inc.
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