The Power of Default Choices: Paper Summary

Defaults became center stage in behavioral science in the early 2000s, after heavy-hitters Richard Thaler and Cass Sunstein started to develop their theory of nudges. Their influential 2008 book Nudge explains their concept of libertarian paternalism: allowing freedom of choice while gently encouraging a desired outcome. 

In a world where we want to minimize the time we spend deciding, defaults are king. And their influence isn’t constrained to toothpaste brands and coffee size. Defaults have been used to dramatically increase organ donations worldwide, from switching from opt-in to opt-out selection methods. Retirement savings plans see a 50% increase in participation when enrollment is the default option.1 Defaults can have drastic impacts on the world around us. 

But how do they work? And are they effective across different contexts? A meta-analysis from Columbia Business School sought to investigate the overarching impact of defaults.