Defaults and Attention: The Drop Out Effect

Abstract

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.

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