Risk and Decision Making Perspectives and Research (1982) / Chapter Skim
Currently Skimming:
Research on Risk and Decision Making
Research on Risk and Decision Making
Pages 47-66
The Chapter Skim interface presents what we've algorithmically identified as the most significant single chunk of text within every page in the chapter.
Select key terms on the right to highlight them within pages of the chapter.
From page 47... ...
RESEARCH ON RISK Al DECISION MAKING People in a large number of professions and disciplines are currently engaged in research related to risk and decision making: Toxicologists devise laboratory experiments to identify potential carcinogens, mutagens, and other toxic substances; Climatologists build models to predict the effects of atmospheric CON concentrations on global weather patterns; Epidemiologists use large data bases to isolate statistical associations between various risk factors (e.g., pollution and diet) and various indices of morbidity and mortality; Physicists, chemists, and biologists study fundamental physical processes to facilitate the identification and assessment of risks; Ecologists investigate the tensions between the needs of humans and the needs of other organisms in an ecosystem; Economists explore the effects of regulation on inflation, employment, innovation, competition, and productivity; 47
|
From page 48... ...
48 Legal scholars assess how various liability doctrines affect both the compensation of victims and the incentives for injurers to engage in risk-generating conduct; Psychologists develop and test theories about how people form perceptions about risks and about how people make personal decisions about risks in their daily lives; Communication specialists examine the potential effects of educational media campaigns on selfhazardous life-styles; Market researchers assess the consequences of advertising on the consumption of hazardous products and substances; Sociologists study the influences of peer pressure on teenage smoking and drinking habits; Political scientists describe and evaluate how different political and economic systems generate and cope with risks; Philosophers and political theorists study the value trade-offs and ethical considerations in risk and decision making; Demographers and biostatisticians compile and analyze risk indices to identify crucial trends in risks over time; Defense analysts weigh the deterrent effects of weapon systems against the risks of escalation in armed conflict; Classical and Bayesian statisticians study how inferences about uncertainties should be made, how new information about risks should be incorporated into old beliefs, and how information about risks from disparate sources should be combined in a formal decision analysis; Organizational theorists study how the incentives and rewards faced by employees in business firms and public agencies cause people to generate and cope with risks; Engineers design safer consumer products and cleaner production processes; they worry about the cost and complexity of safety devices verse the risks of accidents; Geographers study techniques for managing natural hazards and natural disasters; and IS
|
From page 49... ...
A message also carried by the agenda is that performance of risk analysis calls not only for knowledge of its methods but also for disciplinary understanding of the particular problems at issue, be they certifying airplanes or assessing the mutagenic effects of a new chemical; it also demands an awareness of economic and social implications of a given risk and various options for dealing with it. The practice of risk analyses requires the knowledge of many fields; it is in fact an undertaking of multiple disciplines melded together in an interdisciplinary analysis.
|
From page 50... ...
The relative neglect of interdisciplinary research is understandable, given the inherent difficulties with such efforts: differences in problem definition, language barriers between participants, problems in finding spon sors who are sympathetic to joint projects, the complexities in establishing appropriate peer review mechanisms for interdisciplinary work, and the extra time and expense associated with combating all of these difficulties. Despite these problems, the committee believes that an expanded interdisciplinary research program on risk and decision making should be undertaken.
|
From page 51... ...
The agenda follows in its outline that of the first section of this report and takes up in order research on: actual and perceived risks; risk generating and risk coping processes; and approaches to and methods of risk analysis. ACTUAL AND PERCEIVED RISKS A risk analysis, while asking distinct questions and applying specific knowledge, still must be provided with a perspective -- the overall health of society as measured by indicators of the population's health, safety, the state of the environment, or the economy.
|
From page 52... ...
In addition to a regularly published comprehensive collection of existing health, safety, and environmental indicators, serious thought should be given to how to collect, analyze, evaluate, and disseminate additional information about trends and patterns in mortality, morbidity, and environmental quality. Deficiencies in available data should be assessed, including the likelihood of misinterpretations from such data.
|
From page 53... ...
theoretical economists, decision analysts, operations researchers, and management scientists. Behavioral decision analysts have demonstrated in the laboratory and through surveys and clinical studies not only that individuals do not behave according to the rationality assumptions of the prescriptive theories,
|
From page 54... ...
There is a need to foster a closer link between these two communities. Prescriptive theories that are designed to guide behavior should be modified to account for real psychological concerns.
|
From page 55... ...
In some instances, such as hang gliding, the policy response is to do nothing; in others, such as child abuse, the response is vigorous. The design of coping mechanisms and the selection of alternatives is aided by an understanding not only of how risks are generated but also of the milieus in which people tolerate some risks but not others, deliberately expose themselves to risks or with vigor or considerable cost avoid them.
|
From page 56... ...
A critical function of research should be to explore the dimensions of both existing and untried coping strategies, determining the type of risks they may best fit, the implications for decision makers, and associated benefits and costs. Social Experiments It is, of course, very difficult to predict with reasonable accuracy the consequences of innovative coping strategies, such as the sale of pollution licenses and changes in tort law.
|
From page 57... ...
Some coping strategies that are employed extensively in other nations, such as effluent fees for pollution control and legal restrictions on self-hazardous behavior, are not used extensively in the United States. What factors explain the difference in usage, what can be learned from foreign experience, and how can the successful strategies from abroad be implemented in the United States?
|
From page 58... ...
The coping tactics applied to monitoring chemicals are necessarily iterative ones, a constant seeking of an equilibrium among economic, health, safety, and environmental concerns. Such a strategy means setting priorities, accumula tong more experimental evidence, rearranging prorates, and so on.
|
From page 59... ...
Also, examination of such "macro risks" demands extensive interdisciplinary interactions. Taxation Strategies Economists have published research on the theoretical advantages of tax schemes for coping with various risks (e.g., effluent charges for pollution control and consumption fees for hazardous products)
|
From page 60... ...
Applied research talent is needed to exploit these ideas, to show the practicality of such interventions in settling disputes. Innovation, Productivity, and Competition Political debates about regulatory reform frequently contain assertions about the effects of federal regulation on industrial research and development, productivity, and competition.
|
From page 61... ...
Some issues deserving special attention are: the effects of regulatory changes on small firms and industry market shares; the effects of regulatory uncertainty on research, development, and capital investment decisions; and the positive and negative effects of regulation on measures of economic productivity. RISK ANALYS IS While, as emphasized in the first part of this report, analysis has a limited role in decision making, it still can be a powerful tool for categorizing risks, assessing them, evaluating a given set of alternative coping strategies, and devising new alternatives.
|
From page 62... ...
; other analyses might concentrate on separating and linking assessment with those evaluations that consider policy alternatives, value trade-offs, political constraints, implementation concerns, and so on; other analyses might concentrate on cases in which the separation between assessment and evaluation is inappropriate or not achievable without crippling distortions. Some "models" might illustrate the usefulness of simple, back-of-the-envelope quick analysis, whereas others might focus on more elaborate time-consuming studies.
|
From page 63... ...
. Distributional equity with respect to the potential costs and benefits of policies that generate or mitigate risks or allow risks to remain unabated; Distributional equity between the interests of people living today and members of future generations with respect to potential costs and benefits of policies that generate or mitigate risks or allow risks to remain unabated; · The imposition of risks that will fall on a statistically chosen few for the good of many; Proper balancing between incommensurables like expenditures and the saving of anonymous lives; and · The balance between individual freedom of choice and social interventions.
|
From page 64... ...
A clear presentation of indisputable facts dealing with a given uncertainty or uncertainties might suffice tor decision and policy purposes. In some specific circumstance, it may be clear that a given chemical is severely carcinogenic and that appropriate, inexpensive substitutes exist; no profound analysis may be necessary to conclude that the chemical should not be used.
|
From page 65... ...
Some research has been done in statistically validating individual judgments about uncertainties with reality (e.g., how well do meteorologists or stock ,..arket analysts calibrate over time) ; some research has examined how independent judgments from several experts can be combined and how well these composite assessments calibrate with reality (e.g., pooling betting odds of experts on horse races or other sporting events)
|
From page 66... ...
66 Finally, studies are needed of situations in which sepa ration is impossible or inappropriate. What are the most effective ways to conduct analyses for which decomposition is not done?
|
Key Terms
This material may be derived from roughly machine-read images, and so is provided only to facilitate research.
More
information on Chapter Skim is available.