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How Near-Miss Events Amplify or Attenuate Risky Decision Making

Author

Listed:
  • Catherine H. Tinsley

    (McDonough School of Business, Georgetown University, Washington, DC 20057)

  • Robin L. Dillon

    (McDonough School of Business, Georgetown University, Washington, DC 20057)

  • Matthew A. Cronin

    (School of Management, George Mason University, Fairfax, Virginia 22030)

Abstract

In the aftermath of many natural and man-made disasters, people often wonder why those affected were underprepared, especially when the disaster was the result of known or regularly occurring hazards (e.g., hurricanes). We study one contributing factor: prior near-miss experiences. Near misses are events that have some nontrivial expectation of ending in disaster but, by chance, do not. We demonstrate that when near misses are interpreted as disasters that did not occur , people illegitimately underestimate the danger of subsequent hazardous situations and make riskier decisions (e.g., choosing not to engage in mitigation activities for the potential hazard). On the other hand, if near misses can be recognized and interpreted as disasters that almost happened , this will counter the basic "near-miss" effect and encourage more mitigation. We illustrate the robustness of this pattern across populations with varying levels of real expertise with hazards and different hazard contexts (household evacuation for a hurricane, Caribbean cruises during hurricane season, and deep-water oil drilling). We conclude with ideas to help people manage and communicate about risk. This paper was accepted by Teck Ho, decision analysis.

Suggested Citation

  • Catherine H. Tinsley & Robin L. Dillon & Matthew A. Cronin, 2012. "How Near-Miss Events Amplify or Attenuate Risky Decision Making," Management Science, INFORMS, vol. 58(9), pages 1596-1613, September.
    • Handle: RePEc:inm:ormnsc:v:58:y:2012:i:9:p:1596-1613
    DOI: 10.1287/mnsc.1120.1517
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    References listed on IDEAS

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