Psychometric and Demographic Predictors of the Perceived Risk of Terrorist Threats and the Willingness to Pay for Terrorism Risk Management Programs

A 2009 national telephone survey of 924 U.S. adults assessed perceptions of terrorism and homeland security issues. Respondents rated severity of effects, level of understanding, number affected, and likelihood of four terrorist threats: poisoned water supply; explosion of a small nuclear device in a major U.S. city; an airplane attack similar to 9/11; and explosion of a bomb in a building, train, subway, or highway. Respondents rated perceived risk and willingness to pay (WTP) for dealing with each threat. Demographic, attitudinal, and party affiliation data were collected. Respondents rated bomb as highest in perceived risk but gave the highest WTP ratings to nuclear device. For both perceived risk and WTP, psychometric variables were far stronger predictors than were demographic ones. OLS regression analyses using both types of variables to predict perceived risk found only two significant demographic predictors for any threat—Democrat (a negative predictor for bomb) and white male (a significant positive predictor for airline attack). In contrast, among psychometric variables, severity, number affected, and likelihood were predictors of all four threats and level of understanding was a predictor for one. For WTP, education was a negative predictor for three threats; no other demographic variables were significant predictors for any threat. Among psychometric variables, perceived risk and number affected were positive predictors of WTP for all four threats; severity and likelihood were predictors for three; level of understanding was a significant predictor for two.     

Measurement error, skewness, and risk analysis: coping with the long tail of the distribution.

Probabilistic risk analyses often construct multistage chance trees to estimate the joint probability of compound events. If random measurement error is associated with some or all of the estimates, we show that resulting estimates of joint probability may be highly skewed. Joint probability estimates based on the analysis of multistage chance trees are more likely than not to be below the true probability of adverse events, but will sometimes substantially overestimate them. In contexts such as insurance markets for environmental risks, skewed distributions of risk estimates amplify the "winner's curse" so that the estimated risk premium for low-probability events is likely to be lower than the normative value. Skewness may result even in unbiased estimators of expected value from simple lotteries, if measurement error is associated with both the probability and pay-off terms. Further, skewness may occur even if the error associated with these two estimates is symmetrically distributed. Under certain circumstances, skewed estimates of expected value may result in risk-neutral decisionmakers exhibiting a tendency to choose a certainty equivalent over a lottery of equal expected value, or vice versa. We show that when distributions of estimates of expected value are, positively skewed, under certain circumstances it will be optimal to choose lotteries with nominal values lower than the value of apparently superior certainty equivalents. Extending the previous work of Goodman (1960), we provide an exact formula for the skewness of products.     

Regionalization vs. globalization in advertising research: Insights from five decades of academic study

This paper is a response to calls for more research into the regional–as opposed to global–level of international business operations (Rugman and Verbeke, 2004). Focusing on a key issue in international management, the standardization decision, this paper presents a systematic review of top journal articles published over the last five decades on the subject of advertising standardization at the regional level. The results of this review demonstrate that in the last decade studies have frequently taken a regional rather than international focus of analysis, suggesting a shift in research in line with regionalization theory. However, this study also shows that research on regional standardization has lacked consistency in relation to how the phenomenon should be defined and measured. We present a conceptualization of measurement approaches to international advertising standardization, propose a typology of approaches and discuss their implications for knowledge advancement in the area.     

Terrorism Risk Assessment,Recollection Bias,and Public Support for Counterterrorism Policy and Spending

Recollection bias (RB) refers to the phenomenon whereby after an adverse event people report that their risk assessment about a similar future event is presently no higher than their recollection of their pre‐event risk assessment. While previous research has outlined this theoretical construct and generated important empirical findings, there were some limitations. We design and employ a new national representative survey to address these limitations in this study. We examine the existence and persistence of RB among the general public in the context of a number of domestic and international terrorist attacks. We further examine the socioeconomic and political base of RB and the influences of RB on a wide range of citizens’ counterterrorism policy preferences. Our data analyses reveal strong evidence showing the occurrence of RB and its persistence across various forms of terrorism risk. With regard to the socioeconomic and political base, we find that females, older people, political conservatives, and Republicans are less likely to be subject to RB. For the effects of RB on public counterterrorism policy preferences, our analyses demonstrate that this bias significantly dampens public support for a wide range of preventive policy measures and government anti‐terrorism spending. Overall, our study, based on a national representative sample and an extended survey design, provides robust evidence of RB in terrorism risk assessment, and adds further evidence to support the idea that RB is likely a generalizable phenomenon. Implications and suggestions for future research are discussed in the conclusion.     

Lottery Games and Risky Technologies: Communications About Low-Probability/High-Consequence Events

There are strong structural similarities between risks from technological hazards and big-purse state lottery games. Risks from technological hazards are often described as low-probability, high-consequence negative events. State lotteries could be equally well characterized as low-probability, high-consequence positive events. Typical communications about state lotteries provide a virtual strategic textbook for opponents of risky technologies. The same techniques can be used to sell lottery tickets or "sell" opposition to risky technologies. Eight basic principles are enumerated.     

An Analysis of the de minimis Strategy for Risk Management

A de minimis risk management strategy sets a threshold so that risks below the specified level are defined as trivial and exempted from further consideration. The intended purpose is to help avoid inappropriate and wasteful concern with insignificant low-level risks. In most instances a de minimis strategy is likely to have beneficial or innocuous effects, but under certain circumstances large differences may develop between nominal and actual de minimis levels. The potential for such discrepancies illustrates why de minimis (and all other risk management) strategies should be evaluated on the basis of the portfolio of risks that would accumulate from applying such strategies over time, rather than on the apparent reasonableness of any single instance of application.     

Risk Analysis and Risk Management: An Historical Perspective

This paper reviews the history of risk analysis and risk management, giving special emphasis to the neglected period prior to the 20th century. The overall objective of the paper is to: (1) dampen the prevailing tendency to view present-day concerns about risk in an ahistorical context; (2) shed light on the intellectual antecedents of current thinking about risk; (3) clarify how contemporary ideas about risk analysis and societal risk management differ significantly from the past; and (4) provide a basis for anticipating future directions in risk analysis and management.