Imagine two stock brokers: A and B. Broker A failed to invest in a company that would have made her $1200. Broker B already owned shares in this company, but opted to sell his stocks and invest in a different company. Had Broker B kept these stocks in the original company, he would have made an extra $1200. In both cases the broker lost out on a total of $1200. Which broker is more dissatisfied?
Given that they both lost the same amount of money they should be equally dissatisfied, right?However, this doesn’t seem to be the case. Most people (92% of respondents in an experiment that used this example) actually said that broker B—the broker who sold shares that cost him the extra $1200—would feel worse. The reason behind this is a cognitive bias called the omission bias. The omission bias is the tendency to view harmful actions as worse than equally harmful inactions.
The Omission Bias – the tendency to view harmful actions as worse than equally harmful inactions.
Broker A’s Decision –> Don’t Invest (Do Nothing)
Broker B’s Decision –> Sell Shares and Reinvest Elsewhere (Take Action)
Broker A lost out on the money because she failed to do anything differently, whereas broker B lost out on the money because he made a bad choice.
This is one possible explanation for why we default to the status quo. In the short term, missing an opportunity because we didn’t do something seems less bad than failing as a result of our choice to change. One could even argue that by not taking action we remove some of the responsibility for the outcome, because our inaction removes us as a willing participant in whatever situation we find ourselves in. (Or, you know, chalk it up to fate.)
What makes this scenario even more interesting is that when we look back on our past failures, both failures of action and inaction, we rate failures due to inaction as more regrettable than those failures we experienced because we acted. In the short term we might regret a failed relationship, but in the long-term we regret missing a romantic opportunity—the dreaded “what if.”
Additionally, it appears that people are more likely to frame past failures of action as valuable learning opportunities, such as in the case of a failed romantic relationship teaching us what qualities are actually important to us in a partner. Or a bad investment teaching you how to practice better due diligence in the future.
When we are faced with a tough decision, one with an unknown outcome, we are more likely to err on the side of inaction—or to do nothing at all. While this may seem like the advantageous choice in the moment, these are the decisions that may ultimately be the root of our greatest regrets later down the road.
And therein lies the secret. Choosing not to act is a choice in itself. Life does not pause for you to sit on the sidelines; there are no timeouts. You cannot remove the responsibility for your life simply by refusing to play. You are best off taking action.1 You won’t win every time, but you stand a far better chance of steering your life where you actually want to go.
Footnotes:
1This is not to say there aren’t circumstances in which inaction is the best choice, as in the case of a Nigerian Prince wanting to graciously share their inheritance with me, an unknown stranger from a different country, so long as I provide my banking information so they can “deposit” the sum of money. I suppose I’ll go a step further and clarify that you are best off taking intentional action.
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