Thinking and Deciding

RISK REGULATION AND THE INTUITIONS THAT SUPPORT IT 505
lated a ratio. The economic benefits are calculated either in terms of contributions
to the average person’s income or in terms of how much the average person spends
on it. The risks are the annual fatalities. Among the activities with high risk/benefit
ratios were (when these studies were done) motorcycles, smoking, alcohol, hunting,
swimming, and air travel (including private planes). For example, air travel (a typical
member of this group) had (in 1979) about 1,000 fatalities in return for benefits
of about $3,000,000,000 (Fischhoff, Lichtenstein, Slovic, Derby, and Keeney, 1981,
p. 85). Among the activities with low risk/benefit ratios were commercial air travel,
nuclear power, large construction, home appliance, and railroads, with an average
benefit of about $30,000,000,000 for every 1,000 fatalities. These estimates are very
loose, of course, and they vary from study to study (Fischhoff et al., 1981). But the
point is clear, we spend more money regulating involuntary risks.
In the psychometric study just described (Slovic et al., 1985), involuntary exposure,
as judged by the subjects, was correlated with judged need for more stringent
regulation, across risks. This seems at first to be a bias. We could save more lives by
spending resources more equally on voluntary and involuntary risks.
But, on closer examination, it is not clearly a bias. People may differ in the value
(utility) they place on their lives or health, relative to the value the place on other
things, such as the excitement of skiing or riding a motorcycle, the cool image of the
smoker, or the social benefits and good feeling that comes from alcohol. If this is true
to some extent, then — to that extent — people who suffer or die from these activities
are just getting what they bargained for. They accepted the risk as part of the deal. At
least some of these people made a rational decision to ride a motorcycle, go skiing, or
drink. If the decision was rational for them, then any government attempt to prevent
them from doing these things would be a harm. By contrast, nobody gets any thrill
from the risk of exposure to air pollution or bacteria in the water. Thus, our relative
lack of concern for voluntary risks might be rational.
Of course, we might overdo it. Some of these activities affect others, if only
because we could not bring ourselves to deny treatment and, if needed, lifetime care
to someone who suffered brain damage from not wearing a motorcycle helmet, so
we would end up paying for this. It is hard to tell, though, whether our concern with
voluntary risk is too much, too little, or about right.
Known versus unknown
Recall that Factor 1 from the psychometric studies includes unknown risk. Most
unknown risks are those of new technologies, such as new kinds of crops resulting
from genetic engineering. In some studies, people think that risks should be more
highly regulated when the level of the risk is unknown. This belief is related to the
ambiguity effect discussed in Chapter 11. Ambiguity is the perception that missing
information could change our probabilities. People tend to avoid ambiguous options.
Attitudes toward risk regulation seem to be based on the idea that allowing the public
to be exposed to an unknown risk is an option of this sort.