Paying for permanence: Public preferences for contaminated site cleanup

We use conjoint choice questions to investigate the preferences of people in four cities in Italy for income and future/permanent mortality risk reductions delivered by contaminated site remediation policies. The VSL is €5.6 million for an immediate risk reduction. If the risk reduction takes place 20 years from now, the implied VSL is €1.26 million. Respondents’ implicit discount rate is 7%. The VSL depends on respondent characteristics, familiarity with contaminated sites, concern about the health effects of exposure to toxicants, having a family member with cancer, perceived usefulness of public programs and beliefs about the goals of government remediation programs.

Increasing Risk: Some Direct Constructions

This article extends the classic RothschildNStiglitz characterization of comparative risk ("increasing risk") in two directions. By adopting a more general definition of "mean preserving spread" (MPS), it provides a direct construction of a sequence of MPS's linking any pair of distributions that are ranked in terms of comparative risk. It also provides a direct, explicit construction of a zero-conditional-mean "noise" variable for any such pair of distributions. Both results are extended to the case of second order stochastic dominance.     

Do They Know What They are Doing? Risk Perceptions and Smoking Behaviour Among Swedish Teenagers

Cross-sectional survey data on Swedish adolescents aged 12–18 was used to analyse perceived risks of smoking-related lung cancer, the determinants of these risk perceptions, and how these perceptions related to smoking behaviour. Three major conclusions were drawn: (1) that both smokers and non-smokers overestimated the risks of lung cancer, (2) that these risk perceptions fell substantially with age, but nevertheless implied risk overestimation, and (3) that individuals with higher perceived risks were less likely to be smokers but that risk beliefs had no effect on the number of cigarettes smoked.     

Smoking Risks in Spain: Part II—Perceptions of Environmental Tobacco Smoke Externalities

Previous studies of smoking risk beliefs have focused almost exclusively on risks to the smoker. Using an original set of survey data from Spain, we examine the public's perceived risks from exposures to environmental tobacco smoke. The risk categories considered included lung cancer, heart disease, life expectancy loss, and low birth weight for children of smoking mothers. Risk beliefs were quite high, often dwarfing scientific estimates of the risk. The results are consistent with overestimation of risks from highly publicized, low probability events.     

Belief elicitation in the presence of na?ve respondents: An experimental study

It is often of interest to elicit beliefs from populations that may include na?ve participants. Unfortunately, elicitation mechanisms are typically assessed by assuming optimal responses to incentives. Using laboratory experiments with a population that potentially includes na?ve participants, we compare the performance of two elicitation mechanisms proposed by Karni (Econometrica 77(2):603-606, 2009). These mechanisms, denoted as “declarative” and “clock,” are valuable because their incentive compatibility does not require strong assumptions such as risk neutrality or expected utility maximization. We show that, theoretically and empirically, with a sufficient fraction of na?ve participants, the clock mechanism elicits beliefs more accurately than the declarative. The source of this accuracy advantage is twofold: the clock censors na?ve responses, and participants are more likely to employ dominant strategies under the clock. Our findings hold practical value to anyone interested in eliciting beliefs from representative populations, a goal of increasing importance when conducting large-scale surveys or field experiments.     

Risk aversion and religion

We use a dataset for a demographically representative sample of the Dutch population that contains a revealed preference risk attitude measure, as well as detailed information about participants’ religious background, to study three issues. First, we find strong confirmatory evidence that more religious people, as measured by church membership or attendance, are more risk averse with regard to financial risks. Second, we obtain some evidence that Protestants are more risk averse than Catholics in such tasks. Third, our data suggest that the link between risk aversion and religion is driven by social aspects of church membership, rather than by religious beliefs themselves.     

Smoking Risks in Spain: Part I—Perception of Risks to the Smoker

Survey evidence for the Spanish population indicates that perceptions of lung cancer risk and life expectancy loss due to smoking are similar to estimates found in the United States. This paper also presents new evidence on the relative lung cancer risk for smokers, the perceived risk of lung disease for smokers, the heart disease risk for smokers, and the relative heart disease risk for smokers, all of which indicate substantial risk perceptions. Risk beliefs are particularly high for younger respondents, but are lower for better educated respondents.     

Inferring beliefs as subjectively imprecise probabilities

We propose a method for estimating subjective beliefs, viewed as a subjective probability distribution. The key insight is to characterize beliefs as a parameter to be estimated from observed choices in a well-defined experimental task and to estimate that parameter as a random coefficient. The experimental task consists of a series of standard lottery choices in which the subject is assumed to use conventional risk attitudes to select one lottery or the other and then a series of betting choices in which the subject is presented with a range of bookies offering odds on the outcome of some event that the subject has a belief over. Knowledge of the risk attitudes of subjects conditions the inferences about subjective beliefs. Maximum simulated likelihood methods are used to estimate a structural model in which subjects employ subjective beliefs to make bets. We present evidence that some subjective probabilities are indeed best characterized as probability distributions with non-zero variance.     

Residential Respite Care: The Caregiver's Last Resort

Understanding the beliefs that caregivers of people with dementia have in regard to the use of residential respite may inform strategies to address low service utilisation. In this article, the application of theory in qualitative research with 36 caregivers provides insight into why most delay service use. Although some believe that service use may increase caregiving longevity, others position service use in conflict with normative values, and may hold beliefs that negative outcomes will result from utilisation. To address caregivers' beliefs to support service use, improvements are required to service promotion, as well as to models of care.     

A parsimonious model of subjective life expectancy

On average, “young” people underestimate whereas “old” people overestimate their chances to survive into the future. Such subjective survival beliefs violate the rational expectations paradigm and are also not in line with models of rational Bayesian learning. In order to explain these empirical patterns in a parsimonious manner, we assume that self-reported beliefs express likelihood insensitivity and can, therefore, be modeled as non-additive beliefs. In a next step we introduce a closed form model of Bayesian learning for non-additive beliefs which combines rational learning with psychological attitudes in the interpretation of information. Our model gives a remarkable fit to average subjective survival beliefs reported in the Health and Retirement Study.     

Children's Attention to Others' Beliefs during Persuasion: Improvised and Selected Arguments to Puppets and People

Until now children's attention to the beliefs of people they wish to persuade has been examined experimentally via tasks that were artificial in important respects. To determine whether such research has underestimated children's psychological perspective taking, two studies that manipulated task elements pertinent to ecological validity were conducted. Children in three age groups (3, 4/5, and 6/7 years) were asked (forced‐choice and open‐ended formats) how best to persuade puppets and people, with differing beliefs, to pet and play with various toy animals. Children offered as many or more belief‐relevant arguments in response to forced‐choice as to open‐ended questions. Only the oldest group attended to beliefs more when persuading a person compared with a puppet. Even on more realistic tasks, significant improvement with age across task formats confirmed a developmental trajectory in line with extant reports of children's belief reasoning. The findings support the idea that enhanced social competence corresponds specifically to children's increasing attention to beliefs in social interactions such as persuasion.     

Availability Crises in Insurance Markets: Optimal Contracts with Asymmetric Information and Capacity Constraints

Insurance markets sometimes exhibit "crises" in which prices rise dramatically and coverage is unavailable or is rationed at the new prices. A recent explanation for such crises is the "capacity constraint" model of Gron and Winter. Crises usually follow sudden and large depletions in insurers' equity or surplus. The capacity constraint model argues that frictional costs in replacing surplus, and limited liability, give rise to a kinked insurance supply function and that crises arise from discontinuous short term adjustments around the kink. While this model explains much about liability insurance crises, it still leaves unexplained their most prominent feature; that insurance is rationed or unavailable. We follow their insight in looking to equity shocks and capital market frictions to explain crises and combine this with a model of optimal risk sharing contracts under the information conditions characteristic of this market. We use implicit long term contracts with truth telling constraints to address information asymmetries and this allows us to model crises that exhibit rationing. Our model is tested in the market most dramatically affected by such crises in the 1980‘s, the general liability insurance market.     

Electronic cigarette risk beliefs and usage after the vaping illness outbreak

Journal of Risk and Uncertainty - New national survey evidence on electronic cigarette (e-cigarette) risk beliefs indicates that people substantially overestimate the health risks posed by...     

An Experimental Comparison of Induced and Elicited Beliefs

Understanding choice under risk requires knowledge of beliefs and preferences. A variety of methods have been proposed to elicit peoples beliefs. The efficacy of alternative methods, however, has not been rigorously documented. Herein we use an experiment to test whether an induced probability can be recovered using an elicitation mechanism based on peoples predictions about a random event. We are unable to recover the induced belief. Instead, the estimated belief is systematically biased in a way that is consistent with anecdotal evidence in the economics, psychology, and statistics literature: people seem to overestimate low and underestimate high probabilities.     

Dinner with Bayes: On the revision of risk beliefs

Journal of Risk and Uncertainty - We study how people form and revise health risk beliefs based on food safety information. In an online experiment, subjects stated their perceived risk of...     

The Effects of Beliefs Versus Risk Attitude on Bargaining Outcomes

In bargaining environments with uncertain disagreement or “impasse” outcomes (e.g., litigation or labor strike outcomes), there is an identification problem that confounds data interpretation. Specifically, the minimally acceptable settlement value from a risk-averse (risk-loving) but unbiased-belief bargainer is empirically indistinguishable from what one could get with risk-neutrality and pessimistically (optimistically) biased beliefs. This article reports results from a controlled bargaining experiment where data on both risk attitude and beliefs under uncertainty are generated in order to assess their relative importance in bargaining experiment outcomes. The average lab subject is risk-averse, yet optimistic with respect to uncertainty, which is consistent with existing studies that examine each in isolation. I also find that the effects of optimism dominate those of risk-aversion. Optimistic bargainers are significantly more likely to dispute and have aggressive final bargaining positions. Dispute rates are not statistically affected by risk attitude, but there is some evidence that risk aversion leads to a weakened bargaining position. Though additional research is needed to understand the limits of extending these results, a key implication follows. In uncertainty environments where optimism dominates, increased settlement rates are more likely achieved by minimizing impasse uncertainty (to limit the potential for optimism) rather than maximizing uncertainty (to weaken the reservation point of risk-averse bargainers), as has been argued in the dispute resolution literature.      

Residential respite care: the caregiver's last resort

Understanding the beliefs that caregivers of people with dementia have in regard to the use of residential respite may inform strategies to address low service utilisation. In this article, the application of theory in qualitative research with 36 caregivers provides insight into why most delay service use. Although some believe that service use may increase caregiving longevity, others position service use in conflict with normative values, and may hold beliefs that negative outcomes will result from utilisation. To address caregivers' beliefs to support service use, improvements are required to service promotion, as well as to models of care.     

Risk aversion and physical prowess: Prediction,choice and bias

This paper reports on experiments where individuals are asked to make risky decisions for themselves, and to predict the risky decisions of others. Prior research shows that people predict women to be more risk averse than men, a result we confirm. We investigate whether differences in physical prowess underlie actual and perceived gender differences, a hypothesis suggested by both evolutionary and economic theories. Overall we find that perceptions of others’ risk attitudes reflect stereotypes about gender and strength but tend to exaggerate the underlying relationships. Physically stronger and taller people and those perceived as attractive are predicted to be more risk tolerant, while women are perceived to be more risk averse. The impact of gender and physical prowess measures on actual gamble choices is much weaker. Sources of prediction bias are examined, showing that specific characteristics of the target and predictor lead to systematic over-prediction or under-prediction of risk aversion.     

The role of bears and bear ceremonialism in Navajo Orthodox traditional lifeway

The Navajos, who now number over 200,000 in population, are the largest, and one of the most culturally intact Indian tribes in North America. Reigning over a reservation of some 25,000 square miles in size, the Navajos, like many other tribal people have long respected and honored bears as being fellow “being” with whom they share the land. Because of the bears power, intelligence, acute senses, and physical features which closely resemble that of a human, they have also played a major role in Navajo tribal legends and ceremonialism. The purpose of this article is to briefly examine the place of bears and bear ceremonialism within the structure of traditional Navajo beliefs and religious practices.     

Chastity value as a risk factor for prostituted adolescents in Indonesia: a qualitative exploration

ABSTRACT

Previous studies suggest that the practice of female child and adolescent prostitution can be attributed to various personal and social risk factors. However, cultural beliefs shared in specific societies may also determine prostitution involvement. We qualitatively explored the risk factors associated with prostitution in a rarely investigated Indonesian society. We interviewed eight female participants who were involved in adolescent prostitution. The findings suggest that prostitution involvement is not only attributed to the common personal and social risk factors, but also to cultural beliefs of chastity preservation. We argue that such beliefs may be rooted in gender inequality.