IS STATUS QUO BIAS CONSISTENT WITH DOWNWARD-SLOPING DEMAND?

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In this Subject: Economics
By this author: WITTMAN, DONALD

Author: WITTMAN, DONALD

Source: Economic Inquiry, Volume 46, Number 2, April 2008 , pp. 283-288(6)

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Abstract:

We show that status quo bias combined with downward-sloping demand implies addictive behavior. This result does not depend on transitivity, a complete ordering, or even the existence of a preference relation that rationalizes choices. (JEL D11, D81)

Document Type: Research article

DOI: http://dx.doi.org/10.1111/j.1465-7295.2007.00061.x

Publication date: 2008-04-01