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4.1.2 Individual economic decision making
4.1.2.4 Behavioural economics and economic policy
Default choices, restricted choice and mandated choice.
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What is default choice?:
Default choice is the option that consumers end up with if they
do not
actively
choose anything
What is default choice?
Default choice is the option that consumers end up with if they
do
not
actively
choose
anything
What is an example of default choice:
Opt
out
system for organ
donations
What is an example of default choice?
Opt out
system for
organ donations
What is restricted choice?:
Restricted choice is when you
reduce
the
number
of
options
to help consumers overcome the information
availability
bias
When
restricting
the number of choices this causes
consumers
to act and actually make a decision resulting in a more efficient outcome
What is it called when you restrict the amount of information available?
restricted choice
What is it called when when consumers do not actively choose
anything
?
default choice
what is an example of restricted choice?
not allowing
fatty
foods and
sugary
drinks in canteens
What is an example of restricted choice?
not allowing
fatty
foods and
sugary
drinks in canteens
What is Mandated choice?:
Mandated choice is when
consumers
are
forced
to make an
active
decision
What is Mandated Choice?
A mandated choice is when
consumers
are
forced
to make an
active
decision
A mandated choice encourages consumers to think more about that
decision