Risk-defusing in decisions by probability of detection of harm and promotion and prevention focus

Erich Kirchler, Erik Hoelzl and Oswald Huber

Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), 2010, vol. 39, issue 5, 595-600

Abstract: Risk-defusing operators (RDO) are actions that reduce risk, to be enacted either before a negative event occurs (pre-event RDOs) or afterwards (post-event RDOs). For post-event RDOs, detection probability of the negative events is relevant. Regulatory focus theory suggests that promotion-oriented individuals - independent whether it is a personal disposition or favored by situational cues - should focus on chances to succeed and therefore choose post-event RDOs more likely than prevention-oriented individuals who are likely to focus on possible failures and means to avoid them. In two experimental studies, we examined effects of detection probability and regulatory focus as a state variable on the choice of post-event RDOs. Results replicate findings that the likelihood to choose post-event RDOs increases with increasing detection probability of the negative events. Contrary to expectation, no clear effects of regulatory focus were found. Exploratory analyses showed some evidence that successful manipulation of regulatory focus might influence RDO choices if tasks are highly relevant for decision-makers.

Keywords: Risky; decision; Risk-defusing; operators; Regulatory; focus; Promotion; Prevention (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:soceco:v:39:y:2010:i:5:p:595-600

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