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From group diffusion to ratio bias: Effects of denominator and numerator salience on intuitive risk and likelihood judgments

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  • Paul C. Price
  • Teri V. Matthews
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    Abstract

    The group-diffusion effect is the tendency for people to judge themselves to be less likely to experience a negative outcome as the total number of people exposed to the threat increases --- even when the probability of the outcome is explicitly presented (Yamaguchi, 1998). In Experiment 1 we replicated this effect for two health threat scenarios using a variant of Yamaguchi's original experimental paradigm. In Experiment 2, we showed that people also judge themselves to be less likely to be selected in a lottery as the number of people playing the lottery increases. In Experiment 3, we showed that explicitly presenting the number of people expected to be selected eliminates the group-diffusion effect, and in Experiment 4 we showed that presenting the number expected to be affected by a health threat without presenting the total number exposed to the threat produces a reverse effect. We propose, therefore, that the group-diffusion effect is related to the ratio bias. Both effects occur when people make risk or likelihood judgments based on information presented as a ratio. The difference is that the group-diffusion effect occurs when the denominator of the relevant ratio is more salient than the numerator, while the ratio bias occurs when the numerator is more salient than the denominator.

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    Bibliographic Info

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

    Volume (Year): 4 (2009)
    Issue (Month): 6 (October)
    Pages: 436-446

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    Handle: RePEc:jdm:journl:v:4:y:2009:i:6:p:436-446

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    Related research

    Keywords: risk judgment; probability judgment; group-diffusion effect; ratio bias.;

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    Cited by:
    1. Danny Weathers & Scott Swain & Jay Carlson, 2012. "Why consumers respond differently to absolute versus percentage descriptions of quantities," Marketing Letters, Springer, Springer, vol. 23(4), pages 943-957, December.

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