16 Pages Posted: 24 Dec 2008
Date Written: December 3, 2008
Fearsome risks are those that stimulate strong emotional responses. Such risks, which usually involve high consequences, tend to have low probabilities, since life today is no longer nasty, brutish and short. In the face of a low-probability fearsome risk, people often exaggerate the benefits of preventive, risk-reducing, or ameliorative measures. In both personal life and politics, the result is damaging overreactions to risks. We offer evidence for the phenomenon of probability neglect, failing to distinguish between high and low-probability risks. Action bias is a likely result.
Suggested Citation: Suggested Citation
Sunstein, Cass R. and Zeckhauser, Richard J., Overreaction to Fearsome Risks (December 3, 2008). Harvard Law School Program on Risk Regulation Research Paper No. 08-17; HKS Working Paper No. RWP08-079; U of Chicago, Public Law Working Paper No. 446; U of Chicago Law & Economics, Olin Working Paper No. 253. Available at SSRN: https://ssrn.com/abstract=1319881 or http://dx.doi.org/10.2139/ssrn.1319881
By Andrew Lo