By Allan Fromen
EMC recently identified the Privacy Paradox, indicating that consumers want all the benefits of technology, but “take virtually no special action to protect their privacy,” despite an awareness of potential risks and security threats.
What can explain this inconsistency?
Essentially, humans are cognitively lazy. We know this from the Paradox of Choice. Faced with too many options, whether it is planning for retirement or choosing a flavor of jam, we resort to inaction. Better to do nothing than to tax our already overburdened and stressed minds.
Another phenomenon that leads to inaction is the Status Quo Bias, which posits that humans have a strong predilection for the current course of action. This preference for the “default option” is why many employers have switched their 401K plans to automatic enrollment in recent years. We all know we should sign up for our company’s 401K, but many of us fail to do, either due to the myriad of choices (Paradox of Choice) or because we can’t move beyond the default option (Status Quo Bias).
The Status Quo Bias – or the preference to adhere to the default position – may seem easy to overcome. After all, if I care enough about privacy, or saving for retirement, I will simply act on it.
The chart below, showing organ donation consent rates, illustrates the fallacy of such thinking. The differences in organ donors by country are not easily explained by religion, culture, or other similar factors. As Dan Ariely explains, the reason for the variation by country is actually the design of the DMV form. Countries with high organ donor numbers have an opt-out form – meaning you are automatically enrolled as an organ donor unless you opt out. The countries with the smaller numbers have an opt-in form, requiring a specific, cognitive effort, to become an organ donor. The Status Quo Bias is clearly working here, even with such an important and emotional life decision.
