Fast and Slow Thinking in the Face of Catastrophic Risk

24 Pages Posted: 29 Aug 2014

See all articles by Howard Kunreuther

Howard Kunreuther

University of Pennsylvania - Operations, Information and Decisions Department; National Bureau of Economic Research (NBER)

Paul Slovic

Decision Research; University of Oregon - Department of Psychology

Kim Olson

Independent

Date Written: August 19, 2014

Abstract

Studies of behavior in the face of natural disasters and mass atrocities provide common lessons about managing catastrophic threats. We cannot assume that the massive destructiveness of an event will lead us to appreciate and appropriately respond to the risk. The potential consequences, whether in billions of dollars or millions of endangered lives, often fail to convey the emotional meaning necessary to motivate effective protective actions. Rather than trusting our desensitized feelings as our moral compass, we must employ slow and careful thinking, coupled with short-term incentives, to create policies, procedures, laws, and institutions that will nudge or even require us to behave in ways that accord with our considered values for protecting human lives and property.

Keywords: insurance, catastrophic risk, natural disasters, genocide

JEL Classification: D01, D03,D81,G22,Q54.

Suggested Citation

Kunreuther, Howard C. and Slovic, Paul and Olson, Kim, Fast and Slow Thinking in the Face of Catastrophic Risk (August 19, 2014). Available at SSRN: https://ssrn.com/abstract=2488653 or http://dx.doi.org/10.2139/ssrn.2488653

Howard C. Kunreuther (Contact Author)

University of Pennsylvania - Operations, Information and Decisions Department ( email )

3730 Walnut Street
558 & 559 Jon M. Huntsman Hall
Philadelphia, PA 19104-5340
United States
212-854-0423 (Phone)
215-573-2130 (Fax)

National Bureau of Economic Research (NBER)

Paul Slovic

Decision Research ( email )

1201 Oak Street, Suite 200
Eugene, OR 97401
United States
541-485-2400 (Phone)
541-485-2403 (Fax)

HOME PAGE: http://www.decisionresearch.org

University of Oregon - Department of Psychology ( email )

Eugene, OR 97403
United States
541-485-2400 (Phone)

Kim Olson

Independent ( email )

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