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Cognitive influences on risk-seeking by rhesus macaques

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  • Benjamin Y. Hayden
  • Sarah R. Heilbronner
  • Amrita C. Nair
  • Michael L. Platt
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    Abstract

    Humans and other animals are idiosyncratically sensitive to risk, either preferring or avoiding options having the same value but differing in uncertainty. Many explanations for risk sensitivity rely on the non-linear shape of a hypothesized utility curve. Because such models do not place any importance on uncertainty \textit{per se}, utility curve-based accounts predict indifference between risky and riskless options that offer the same distribution of rewards. Here we show that monkeys strongly prefer uncertain gambles to alternating rewards with the same payoffs, demonstrating that uncertainty itself contributes to the appeal of risky options. Based on prior observations, we hypothesized that the appeal of the risky option is enhanced by the salience of the potential jackpot. To test this, we subtly manipulated payoffs in a second gambling task. We found that monkeys are more sensitive to small changes in the size of the large reward than to equivalent changes in the size of the small reward, indicating that they attend preferentially to the jackpots. Together, these results challenge utility curve-based accounts of risk sensitivity, and suggest that psychological factors, such as outcome salience and uncertainty itself, contribute to risky decision-making.

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    Bibliographic Info

    Article provided by Society for Judgment and Decision Making in its journal Judgment and Decision Making.

    Volume (Year): 3 (2008)
    Issue (Month): (June)
    Pages: 389-395

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    Handle: RePEc:jdm:journl:v:3:y:2008:i::p:389-395

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    Related research

    Keywords: risk; risk sensitivity; rhesus macaque; utility curve; biased anchoring; expected utility. %JEL codes: D81; D87;

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    1. Peter Fishburn, 1980. "A simple model for the utility of gambling," Psychometrika, Springer, vol. 45(4), pages 435-448, December.
    2. Enrico Diecidue & Ulrich Schmidt & Peter P. Wakker, 2004. "The Utility of Gambling Reconsidered," Journal of Risk and Uncertainty, Springer, vol. 29(3), pages 241-259, December.
    3. Folkes, Valerie S, 1988. " The Availability Heuristic and Perceived Risk," Journal of Consumer Research, University of Chicago Press, vol. 15(1), pages 13-23, June.
    4. Victor Matheson, 2001. "When Are State Lotteries a Good Bet (Revisited)?," Eastern Economic Journal, Eastern Economic Association, vol. 27(1), pages 55-70, Winter.
    5. M. Keith Chen & Venkat Lakshminarayanan & Laurie R. Santos, 2006. "How Basic Are Behavioral Biases? Evidence from Capuchin Monkey Trading Behavior," Journal of Political Economy, University of Chicago Press, vol. 114(3), pages 517-537, June.
    6. Ariely, Dan & Loewenstein, George & Prelec, Drazen, 2006. "Tom Sawyer and the construction of value," Journal of Economic Behavior & Organization, Elsevier, vol. 60(1), pages 1-10, May.
    7. Battalio, Raymond C & Kagel, John H & Jiranyakul, Komain, 1990. " Testing between Alternative Models of Choice under Uncertainty: Some Initial Results," Journal of Risk and Uncertainty, Springer, vol. 3(1), pages 25-50, March.
    8. Matthew Rabin, 2001. "Risk Aversion and Expected Utility Theory: A Calibration Theorem," Levine's Working Paper Archive 7667, David K. Levine.
    9. Milton Friedman & L. J. Savage, 1948. "The Utility Analysis of Choices Involving Risk," Journal of Political Economy, University of Chicago Press, vol. 56, pages 279.
    10. Amos Tversky & Daniel Kahneman, 1979. "Prospect Theory: An Analysis of Decision under Risk," Levine's Working Paper Archive 7656, David K. Levine.
    11. Clotfelter, Charles T & Cook, Philip J, 1990. "On the Economics of State Lotteries," Journal of Economic Perspectives, American Economic Association, vol. 4(4), pages 105-19, Fall.
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