Risk behavior in decision-making in a multi-person-setting

Thomas Fenzl and Thomas Brudermann

Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), 2009, vol. 38, issue 5, 752-756

Abstract: When people have to make a choice in an individual setting between a known-risk option and an untested situation of uncertainty, the majority prefers the known risk over the uncertainty of the alternative. The confrontation with an unfamiliar situation in an environment including other participants allows for new mechanisms in risk-perception and risk-evaluation. People tend to become other-directed and use the behavior and consequences of actions of other people in the environment to assess risk. Our investigations show that warning signals observable in the behavior of other participants in the setting reinforce people's preference for known risks over uncertainty.

Keywords: Risk; behavior; Uncertainty; Decision-making; Multi-person-setting; Other-directed (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:soceco:v:38:y:2009:i:5:p:752-756

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