Decisions Have An Opportunity Cost That Require Tradeoffs

Presidential “Choice Fatigue”

by Elaine Schwartz    •    Sep 16, 2012    •    872 Views

President Obama says he wears only gray or blue suits. As for meals, he prefers having others decide what he will eat. The reason? “Choice fatigue.” Knowing that decision-making requires energy, the President told writer Michael Lewis that he tries not to think about what he will wear and what he will eat. He saves his energy for the important stuff.

Researchers have confirmed that we start to take shortcuts after making up our minds too many times. In one study, voters react to the same proposition differently, depending on its position on the ballot. The higher the proposition, the less likely we will select a “decision short-cut” like maintaining the status quo. For cars, observers noted that when asked to choose among “4 styles of gearshift knobs, 13 kinds of wheel rims, 25 configurations of the engine and gearbox and a palette of 56 colors for the interior,” people got too worn out and turned to the default option.

Prior decisions affect how much energy we have for future decisions.

As a result, if you are president (or just planning your own productive day), you do not want to use up your decision making energy on clothing and food. As an auto dealer, you might want to start with multiple options so that buyers opt for the default (and more pricey) alternative. Perhaps we can even attribute some of the housing debacle to “choice fatigue.” Mortgage agreements were so complex, that buyers just took the easiest route.

Sources and Resources: I especially recommend Michael Lewis’s Vanity Fair article on President Obama and John’s Tierney’s NY Times Magazine article on decision fatigue. For additional academic details about decision fatigue studies, you might further enjoy this paper.

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