Defaults in organ donation systems
The discrepancy between demand and supply over transplantable organs is a significant health problem, especially for developing countries.13 Thus, policy debates in such countries focus on solving this shortage and mostly compares two systems: explicit consent versus presumed consent. In the former, the default is that nobody is a donor unless they explicitly register and opt in. The main drawback with the explicit consent system is that donation rates tend to be low, and less than reported willingness to donate. On the other hand, the presumed consent system registers every adult as a donor unless they explicitly opt out. However, a drawback with presumed consent is that families of a deceased relative may object on their behalf and withdraw consent, which lowers donation rates and governments can be seen as taking advantage of citizens’ consent.
To address these issues, researchers from the Netherlands considered a third option: a system of mandated choice.13 In this situation, there is no default and citizens have to actively make a choice. The researchers used hypothetical choices from a national survey in 2011, and chose to sample citizens of the Netherlands in which there is an explicit consent system in place. 2069 individuals aged 16 years and older were divided into three groups representing the explicit consent, presumed consent, and mandated choice systems. Participants were asked whether they would stay with the default or actively opt in or out for explicit and presumed consent, respectively, and whether they would opt in or out for mandated choice. All participants were also given the choice to answer that they didn’t know.
The results of the study showed that – at least in the Netherlands, which is a country with an explicit consent system – both systems of mandated choice and presumed consent were more effective than explicit consent in increasing the number of registered donors.13 The researchers suggest that people may be more inclined to register in the mandated choice system than the explicit consent system due to humans’ propensities to procrastinate when making decisions. Such an explanation would support the power of defaults and encouragement for choice architects to mandate choices, as suggested by Thaler and colleagues in the first principle of choice architecture.1 While results from a study in the Netherlands does not guarantee equivalent results in developing countries that are experiencing an organ shortage, the results suggest that a mandated choice system should be considered in policy debates and points to the power of defaults in which people are opted out.
Save More Tomorrow: Easy and painless retirement
As average life expectancies increase, the time spent in requirement commonly increases as well, subsequently increasing the money required for security and comfort. The life cycle theory in economics holds that the general population will solve this problem like economists would, by calculating their required savings and distributing their finances to match this.14 However, this is not always the case, due to two reason: it is difficult to make such calculations, and in the case that correct calculations are made, people may lack the required self-control to appropriately reduce their consumption rates.
Richard Thaler and behavioral economist Shlomo Benartzi recognized that people have a loss-aversion bias: when people are forced to cut their present spending to save for their pension, they perceive a loss instead of a future gain.14 This is where the problem of self-control ties in. Additionally, people tend to procrastinate when making decisions, especially for unpleasant or difficult tasks. While people may want to save for retirement, they keep putting it off. This leads to the status quo bias, allowing people to remain in their current situation regardless of what they know the rational optimal choice is.
To address these issues and to help people save for retirement, Thaler and behavioral economist Benartzi designed the Save More Tomorrow plan.14 The intervention implements choice architecture through seemingly simple, but very influential components. The first aspect is automatically enrolling all employees in a savings plan right when they become eligible. This means that while employees can choose to opt out of the plan, their default choice is a commitment. The second aspect is that increases in savings rates are linked to future pay raises. This way, take-home pay always increases and deductions are taken from money that the employee was not used to having, helping overcome loss aversion.
Thaler and Benartzi’s intervention of choice architecture has proven to nudge a higher savings rate for long-term gains and has appealed to people who were not otherwise interested in a savings plan.14 Designed in 2004, it was enforced as part of the Pension Protection Act of 2006, encouraging companies to adopt the core principles.15