Collaborative Integrity Collaborative Integrity / Items

Preoccupations - In Hard Times, Fear Can Impair Decision-Making

Get Feed
Preoccupations - In Hard Times, Fear Can Impair Decision-Making
Description
Anxiety can discourage exploratory activity and risk-taking — and prolong a financial downturn.
Original URL
http://www.nytimes.com/2008/12/07/jobs/07pre.html

Comments

  • Public Comments

    • Iain Macadair Iain Macadair
      6 months ago


      "When strong emotions are involved, people tend to focus on the badness of the outcome, rather than on the probability that the outcome will occur. The resulting 'probability neglect' helps to explain excessive reactions to low-probability risks of catastrophe. Terrorists show a working knowledge of probability neglect, producing public fear that might greatly exceed the discounted harm. As a result of probability neglect, people often are far more concerned about the risks of terrorism than about statistically larger risks that they confront in ordinary life. In the context of terrorism and analogous risks, the legal system frequently responds to probability neglect,
      resulting in regulation that might be unjustified or even counterproductive. But public fear is itself a cost, and
      it is associated with many other costs, in the form of 'ripple effects' produced by fear. As a normative matter,
      government should reduce even unjustified fear, if the benefits of the response can be shown to outweigh the costs."

      Cass R. Sunstein
      The Journal of Risk and Uncertainty, 26:2/3; 121–136, 2003
      Collaborative Integrity
    Add a Comment
Report This

Twine is about discovering, collecting and sharing the content that interests you. Learn More

Join Twine

Stats

First Posted By

Iain Macadair

First Comment By

Iain Macadair

Related Items

Tags

Community Tags

Who's Interested In This?

Forgot your password?