Recollection Bias and Its Underpinnings: Lessons from Terrorism Risk Assessments

Recollection bias is the phenomenon whereby people who observe a highly unexpected event hold current risk beliefs about a similar event that are no higher than their recollection of their prior beliefs. This article replicates and extends the authors’ previous study of recollection bias in relation to individuals’ perceptions of the risks of terrorism attacks. Over 60% of respondents in a national U.S. sample of over 900 adults believe that the current risk of a future terrorist attack by either an airplane or in a public setting is no higher than they recall having believed, respectively, before the 9/11 attack and before the Boston Marathon bombing. By contrast, a rational Bayesian model would update to a higher currently assessed risk of these previously uncontemplated events. Recollection bias is a persistent trait: individuals who exhibited this bias for the 9/11 attack exhibited it for the Boston Marathon bombing. Only one‐fifth of respondents are free of any type of recollection bias. Recollection bias is negatively correlated with absolute levels of risk belief. Recollection bias in relation to highly unexpected terrorist events—the belief that perceived risks did not increase after the surprise occurrence—dampens support for a variety of anti‐terrorism measures, controlling for the level of risk beliefs and demographic factors. Persistent recollection bias for both 9/11 and the Boston Marathon bombing is especially influential in diminishing support for protective policy measures, such as surveillance cameras in public places. Given that public attitudes influence policy, educating the public about risk is critical.     

A Methodology for Modeling Regional Terrorism Risk

Over the past decade, terrorism risk has become a prominent consideration in protecting the well‐being of individuals and organizations. More recently, there has been interest in not only quantifying terrorism risk, but also placing it in the context of an all‐hazards environment in which consideration is given to accidents and natural hazards, as well as intentional acts. This article discusses the development of a regional terrorism risk assessment model designed for this purpose. The approach taken is to model terrorism risk as a dependent variable, expressed in expected annual monetary terms, as a function of attributes of population concentration and critical infrastructure. This allows for an assessment of regional terrorism risk in and of itself, as well as in relation to man‐made accident and natural hazard risks, so that mitigation resources can be allocated in an effective manner. The adopted methodology incorporates elements of two terrorism risk modeling approaches (event‐based models and risk indicators), producing results that can be utilized at various jurisdictional levels. The validity, strengths, and limitations of the model are discussed in the context of a case study application within the United States.     

Relative Risk Perception for Terrorism: Implications for Preparedness and Risk Communication

Terrorism presents a significant risk that is often approached at public policy, infrastructure, or emergency management level. Public perceptions of the likelihood of terrorist events, and how this may relate to individual preparedness, are not always extensively examined. The tendency to think that negative events are less likely to happen to oneself than to the average person is known as optimism bias. Optimism bias is relevant to perceptions of terrorism, because it is thought to be related to a reduction in precaution use. Using an online survey of 164 participants, this study aimed to determine whether Sydney residents thought they had a lower likelihood of experiencing terrorist events than other Australians. Significant optimism bias was observed for witnessing terrorist events, but not for personally experiencing terrorist events. In addition, Sydney residents tended to think that terrorist attacks were more likely to occur in Sydney than another major Australian city in the next five years. At the same time, household and workplace preparedness for terrorism was quite low, as was awareness of emergency strategies in the central business district. Perceptions of high likelihood of terrorism happening in one's own city, yet low preparedness present a challenge for risk communication and emergency management strategies. The diversity of possible terrorist targets, and the simple plans that can moderate the effects of a disaster may need to be emphasized in future anti‐terrorism initiatives.     

Victim Countries of Transnational Terrorism: An Empirical Characteristics Analysis

This study empirically investigates the association between country‐level socioeconomic characteristics and risk of being victimized in transnational terrorism events. We find that a country's annual financial contribution to the U.N. general operating budget has a positive association with the frequency of being victimized in transnational terrorism events. In addition, per capita GDP, political freedom, and openness to trade are nonlinearly related to the frequency of being victimized in transnational terrorism events.     

Communicating with the Public About Marauding Terrorist Firearms Attacks: Results from a Survey Experiment on Factors Influencing Intention to “Run,Hide, Tell” in the United Kingdom and Denmark

Effective risk communication is an integral part of responding to terrorism, but until recently, there has been very little pre‐event communication in a European context to provide advice to the public on how to protect themselves during an attack. Following terrorist attacks involving mass shootings in Paris, France, in November 2015, the U.K. National Police Chiefs’ Council released a Stay Safe film and leaflet that advises the public to “run,” “hide,” and “tell” in the event of a firearms or weapons attack. However, other countries, including Denmark, do not provide preparedness information of this kind, in large part because of concern about scaring the public. In this survey experiment, 3,003 U.K. and Danish participants were randomly assigned to one of three conditions: no information, a leaflet intervention, and a film intervention to examine the impact of “Run, Hide, Tell” advice on perceptions about terrorism, the security services, and intended responses to a hypothetical terrorist firearms attack. Results demonstrate important benefits of pre‐event communication in relation to enhancing trust, encouraging protective health behaviors, and discouraging potentially dangerous actions. However, these findings also suggest that future communications should address perceived response costs and target specific problem behaviors. Cross‐national similarities in response suggest this advice is suitable for adaptation in other countries.     

A Comparative Analysis of PRA and Intelligent Adversary Methods for Counterterrorism Risk Management

In counterterrorism risk management decisions, the analyst can choose to represent terrorist decisions as defender uncertainties or as attacker decisions. We perform a comparative analysis of probabilistic risk analysis (PRA) methods including event trees, influence diagrams, Bayesian networks, decision trees, game theory, and combined methods on the same illustrative examples (container screening for radiological materials) to get insights into the significant differences in assumptions and results. A key tenent of PRA and decision analysis is the use of subjective probability to assess the likelihood of possible outcomes. For each technique, we compare the assumptions, probability assessment requirements, risk levels, and potential insights for risk managers. We find that assessing the distribution of potential attacker decisions is a complex judgment task, particularly considering the adaptation of the attacker to defender decisions. Intelligent adversary risk analysis and adversarial risk analysis are extensions of decision analysis and sequential game theory that help to decompose such judgments. These techniques explicitly show the adaptation of the attacker and the resulting shift in risk based on defender decisions.     

The Role of Quantitative Risk Assessments for Characterizing Risk and Uncertainty and Delineating Appropriate Risk Management Options, with Special Emphasis on Terrorism Risk

The purpose of this article is to discuss the role of quantitative risk assessments for characterizing risk and uncertainty and delineating appropriate risk management options. Our main concern is situations (risk problems) with large potential consequences, large uncertainties, and/or ambiguities (related to the relevance, meaning, and implications of the decision basis; or related to the values to be protected and the priorities to be made), in particular terrorism risk. We look into the scientific basis of the quantitative risk assessments and the boundaries of the assessments in such a context. Based on a risk perspective that defines risk as uncertainty about and severity of the consequences (or outcomes) of an activity with respect to something that humans value we advocate a broad risk assessment approach characterizing uncertainties beyond probabilities and expected values. Key features of this approach are qualitative uncertainty assessment and scenario building instruments.     

A Risk-Based Approach to Setting Priorities in Protecting Bridges Against Terrorist Attacks

This article presents an approach to the problem of terrorism risk assessment and management by adapting the framework of the risk filtering, ranking, and management method. The assessment is conducted at two levels: (1) the system level, and (2) the asset-specific level. The system-level risk assessment attempts to identify and prioritize critical infrastructures from an inventory of system assets. The definition of critical infrastructures offered by Presidential Decision Directive 63 was used to determine the set of attributes to identify critical assets--categorized according to national, regional, and local impact. An example application is demonstrated using information from the Federal Highway Administration National Bridge Inventory for the State of Virginia. Conversely, the asset-specific risk assessment performs an in-depth analysis of the threats and vulnerabilities of a specific critical infrastructure. An illustration is presented to offer some insights in risk scenario identification and prioritization, multiobjective evaluation of management options, and extreme-event analysis for critical infrastructure protection.     

How Probabilistic Risk Assessment Can Mislead Terrorism Risk Analysts

Traditional probabilistic risk assessment (PRA), of the type originally developed for engineered systems, is still proposed for terrorism risk analysis. We show that such PRA applications are unjustified in general. The capacity of terrorists to seek and use information and to actively research different attack options before deciding what to do raises unique features of terrorism risk assessment that are not adequately addressed by conventional PRA for natural and engineered systems—in part because decisions based on such PRA estimates do not adequately hedge against the different probabilities that attackers may eventually act upon. These probabilities may differ from the defender's (even if the defender's experts are thoroughly trained, well calibrated, unbiased probability assessors) because they may be conditioned on different information. We illustrate the fundamental differences between PRA and terrorism risk analysis, and suggest use of robust decision analysis for risk management when attackers may know more about some attack options than we do.     

A Social-Cognitive Perspective of Terrorism Risk Perception and Individual Response in Canada

The volume of research on terrorism has increased since the events of September 11, 2001. However, efforts to develop a contextualized model incorporating cognitive, social-contextual, and affective factors as predictors of individual responses to this threat have been limited. Therefore, the aim of this study was to evaluate a series of hypotheses drawn from such a model that was generated from a series of interviews with members of the Canadian public. Data of a national survey on perceived chemical, biological, radiological, nuclear, and explosives (CBRNE) terrorism threat and preparedness were analyzed. Results demonstrated that worry and behavioral responses to terrorism, such as individual preparedness, information seeking, and avoidance behaviors, were each a function of cognitive and social-contextual factors. As an affective response, worry about terrorism independently contributed to the prediction of behavioral responses above and beyond cognitive and social-contextual factors, and partially mediated the relationships of some of these factors with behavioral responses. Perceived coping efficacy emerged as the cognitive factor associated with the most favorable response to terrorism. Hence, findings highlight the importance of fostering a sense of coping efficacy to the effectiveness of strategies aimed at improving individual preparedness for terrorism.     

The Rise of Global Warming Skepticism: Exploring Affective Image Associations in the United States Over Time

This article explores how affective image associations to global warming have changed over time. Four nationally representative surveys of the American public were conducted between 2002 and 2010 to assess public global warming risk perceptions, policy preferences, and behavior. Affective images (positive or negative feelings and cognitive representations) were collected and content analyzed. The results demonstrate a large increase in “naysayer” associations, indicating extreme skepticism about the issue of climate change. Multiple regression analyses found that holistic affect and “naysayer” associations were more significant predictors of global warming risk perceptions than cultural worldviews or sociodemographic variables, including political party and ideology. The results demonstrate the important role affective imagery plays in judgment and decision‐making processes, how these variables change over time, and how global warming is currently perceived by the American public.     

Analytical Paradigms: The Epistemological Distances between Scientists, Policy Makers, and the Public

The effective use of evidence and its resultant knowledge is increasingly recognized as critical in risk analysis. This, in turn, has led to a growing concern over issues of epistemology in risk communication, and, in particular, interest in how knowledge is constructed and employed by the key players in risk--scientists, policy makers, and the public. This article uses a critical theoretical approach to explore how evidence is recognized and validated, and how limits are placed on knowledge by scientists, policy makers, and the public. It brings together developments in the sociology of science, policy and policy development, public understandings of science, and risk communication and analysis to explicate the differing forms of rationality employed by each group. The work concludes that each group employs different, although equally legitimate, forms of rationality when evaluating evidence and generating knowledge around risky environment and health issues. Scientists, policy makers, and the public employ scientific, political, and social rationality, respectively. These differing forms of rationality reflect underlying epistemological distances from which can develop considerable misunderstandings and misinterpretations.     

Informing Ex Ante Event Studies with Macro‐Econometric Evidence on the Structural and Policy Impacts of Terrorism

Economic consequence analysis is one of many inputs to terrorism contingency planning. Computable general equilibrium (CGE) models are being used more frequently in these analyses, in part because of their capacity to accommodate high levels of event‐specific detail. In modeling the potential economic effects of a hypothetical terrorist event, two broad sets of shocks are required: (1) physical impacts on observable variables (e.g., asset damage); (2) behavioral impacts on unobservable variables (e.g., investor uncertainty). Assembling shocks describing the physical impacts of a terrorist incident is relatively straightforward, since estimates are either readily available or plausibly inferred. However, assembling shocks describing behavioral impacts is more difficult. Values for behavioral variables (e.g., required rates of return) are typically inferred or estimated by indirect means. Generally, this has been achieved via reference to extraneous literature or ex ante surveys. This article explores a new method. We elucidate the magnitude of CGE‐relevant structural shifts implicit in econometric evidence on terrorist incidents, with a view to informing future ex ante event assessments. Ex post econometric studies of terrorism by Blomberg et al . yield macro econometric equations that describe the response of observable economic variables (e.g., GDP growth) to terrorist incidents. We use these equations to determine estimates for relevant (unobservable) structural and policy variables impacted by terrorist incidents, using a CGE model of the United States. This allows us to: (i) compare values for these shifts with input assumptions in earlier ex ante CGE studies; and (ii) discuss how future ex ante studies can be informed by our analysis.     

The Contrast Between Risk Assessment and Rules of Evidence in the Context of International Trade Disputes: Can the U.S. Experience Inform the Process?

Risk assessment provides a formalized process to evaluate human, animal, and ecological responses associated with exposure to environmental agents. The purpose of risk assessment is to answer two related questions.

• ? How likely is an (adverse) event to occur?
• ? If it does, how severe will the impact be?

In the United States, the science of risk assessment has evolved out of the necessity to make public health decisions in the face of scientific uncertainty. Its basic propositions have been established over the past three decades and its applications have impacted virtually every aspect of public health and environmental protection in many countries, including the United States. More recently, the World Trade Organization's (WTO) dispute‐settlement process has provided additional incentive for the reliance on risk assessments internationally through the requirement that member countries be able to provide scientific justification, based on a risk assessment, for public health and environmental regulatory measures that are challenged. The purpose of this article is to review the history of risk assessment in the United States, emphasizing the development of both its scientific and policy aspects, as one example of the development of institutional capacity for risk assessment. This article discusses the importance of the social, political, and economic contexts of risk assessment and risk management in shaping the approaches taken while highlighting the reality that the analytic or risk assessment part of the decision‐making process, in the absence of scientific data, can be completed only by inserting inferences, or policy judgments, which may differ among countries. This article recognizes these differences, and the consequent difference between risk assessment that incorporates public health protective assumptions and the rules of evidence that seek to answer questions of causality, and discusses implications for the WTO dispute‐settlement process. It further explores the value of country‐specific risk assessment guidelines to facilitate consistency within a country along with the appropriateness and feasibility of international risk assessment guidelines.     

Behavioral Channels in the Cross‐Market Diffusion of Major Terrorism Shocks

The diffusion mechanism of terrorist shocks to third countries’ stock market responses is explored by employing a Heckit model. Stock market response is broken down to (i) the direction of reaction and (ii) conditional on negative reaction, its magnitude. The analysis puts forward two behavioral factors (memory‐based utility/availability heuristic, social amplification of risk), proxied by past terrorism record and terrorism risk concern as the shocks’ diffusion channels. The findings are that the likelihood and the size of negative stock market reaction increase with terrorism record and risk concern. Additionally, weak evidence is uncovered for a mitigation of risk concern's impact by favorable macroeconomic stance. Furthermore, the impact of behavioral factors, especially over the magnitude of reaction, is robust when controlling for economic linkages. The latter are also significant predictors of the direction of stock market reaction, but not of its magnitude.     

Guiding Resource Allocations Based on Terrorism Risk

Establishing tolerable levels of risk is one of the most contentious and important risk management decisions. With every regulatory or funding decision for a risk management program, society decides whether or not risk is tolerable. The Urban Area Security Initiative (UASI) is a Department of Homeland Security (DHS) grant program designed to enhance security and overall preparedness to prevent, respond to, and recover from acts of terrorism by providing financial assistance for planning, equipment, training, and exercise needs of large urban areas. After briefly reviewing definitions of terrorism risk and rationales for risk-based resource allocation, this article compares estimates of terrorism risk in urban areas that received UASI funding in 2004 to other federal risk management decisions. This comparison suggests that UASI allocations are generally consistent with other federal risk management decisions. However, terrorism risk in several cities that received funding is below levels that are often tolerated in other risk management contexts. There are several reasons why the conclusions about terrorism risk being de minimis in specific cities should be challenged. Some of these surround the means used to estimate terrorism risk for this study. Others involve the comparison that is made to other risk management decisions. However, many of the observations reported are valid even if reported terrorism risk estimates are several orders of magnitude too low. Discussion of resource allocation should be extended to address risk tolerance and include explicit comparisons, like those presented here, to other risk management decisions.     

WHY IS FISCAL POLICY OFTEN PROCYCLICAL?

Fiscal policy is procyclical in many developing countries. We explain this policy failure with a political agency problem. Procyclicality is driven by voters who seek to “starve the Leviathan” to reduce political rents. Voters observe the state of the economy but not the rents appropriated by corrupt governments. When they observe a boom, voters optimally demand more public goods or lower taxes, and this induces a procyclical bias in fiscal policy. The empirical evidence is consistent with this explanation: Procyclicality of fiscal policy is more pronounced in more corrupt democracies. (JEL: E62, D73, D78)     

Indiscriminate,Irrelevant, and Sometimes Wrong: Causal Misconceptions about Climate Change

Prior research demonstrates widespread persistence of beliefs about climate change causes and risks that are arguably misconceptions. They include believing pollution causes climate change, believing ozone depletion causes climate change, the combination of these two “green beliefs,” referred to as environmental problems, and believing natural climate variation significantly contributes to current climate trends. Each of these causal beliefs has the potential to weaken or divert support away from effective climate change risk mitigation policies. To assess this potential, we explore the nature and prevalence of these beliefs in the United States with a national sample of interviews (N = 77) and two national surveys (N = 1,013, N = 1,820), and apply regression and mediation analyses to explore whether they explain any of the variation in individuals’ concern or support for policy to mitigate climate change. Adherence to these beliefs—which reflect a variety of misconceptions illustrated in the interviews—differs by political ideology but is common, with over a third of interviewees mentioning one or more. Controlling for general knowledge, political ideology, and other factors, misconceptions about environmental problems are still associated directly with support for climate change policies. On average adherence to the belief that environmental problems cause climate change is associated with a 25% higher probability of policy support. In contrast, believing natural climate variability is a major recent cause of climate change is associated with a 7% lower probability of supporting climate policy, even after controlling for political ideology and other knowledge about climate change.     

Using Probabilistic Terrorism Risk Modeling for Regulatory Benefit-Cost Analysis: Application to the Western Hemisphere Travel Initiative in the Land Environment

This article presents a framework for using probabilistic terrorism risk modeling in regulatory analysis. We demonstrate the framework with an example application involving a regulation under consideration, the Western Hemisphere Travel Initiative for the Land Environment, (WHTI‐L). First, we estimate annualized loss from terrorist attacks with the Risk Management Solutions (RMS) Probabilistic Terrorism Model. We then estimate the critical risk reduction, which is the risk‐reducing effectiveness of WHTI‐L needed for its benefit, in terms of reduced terrorism loss in the United States, to exceed its cost. Our analysis indicates that the critical risk reduction depends strongly not only on uncertainties in the terrorism risk level, but also on uncertainty in the cost of regulation and how casualties are monetized. For a terrorism risk level based on the RMS standard risk estimate, the baseline regulatory cost estimate for WHTI‐L, and a range of casualty cost estimates based on the willingness‐to‐pay approach, our estimate for the expected annualized loss from terrorism ranges from $2.7 billion to $5.2 billion. For this range in annualized loss, the critical risk reduction for WHTI‐L ranges from 7% to 13%. Basing results on a lower risk level that results in halving the annualized terrorism loss would double the critical risk reduction (14–26%), and basing the results on a higher risk level that results in a doubling of the annualized terrorism loss would cut the critical risk reduction in half (3.5–6.6%). Ideally, decisions about terrorism security regulations and policies would be informed by true benefit‐cost analyses in which the estimated benefits are compared to costs. Such analyses for terrorism security efforts face substantial impediments stemming from the great uncertainty in the terrorist threat and the very low recurrence interval for large attacks. Several approaches can be used to estimate how a terrorism security program or regulation reduces the distribution of risks it is intended to manage. But, continued research to develop additional tools and data is necessary to support application of these approaches. These include refinement of models and simulations, engagement of subject matter experts, implementation of program evaluation, and estimating the costs of casualties from terrorism events.