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Action Bias and Environmental Decisions

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  • Patt, Anthony
  • Zeckhauser, Richard

Abstract

Individuals have a penchant for action, often for good reasons. But action bias arises if that penchant is carried over to areas where those reasons do not apply, hence is nonrational. Action bias is explored theoretically, and then empirically, using data from surveys of hypothetical environmental decisions. Quite apart from agency considerations, individuals like to affect outcomes when gains are reaped. Given the ability to help one of two sites, we find that decision makers choose to foster improvement rather than prevent deterioration, despite framing that makes it arbitrary which site is improved, which preserved. Strong action bias--individuals choosing to reap gains even though they must impose losses--is also observed. These concepts are related to loss aversion, status quo bias, omission bias for losses, and bright-line behavior. Copyright 2000 by Kluwer Academic Publishers

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Bibliographic Info

Article provided by Springer in its journal Journal of Risk and Uncertainty.

Volume (Year): 21 (2000)
Issue (Month): 1 (July)
Pages: 45-72

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Handle: RePEc:kap:jrisku:v:21:y:2000:i:1:p:45-72

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Web page: http://www.springerlink.com/link.asp?id=100299

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Cited by:
  1. Gernot Wagner & Richard Zeckhauser, 2012. "Climate policy: hard problem, soft thinking," Climatic Change, Springer, vol. 110(3), pages 507-521, February.
  2. Zeckhauser, Richard, 2008. "Overreaction to Fearsome Risks," Working Paper Series rwp08-079, Harvard University, John F. Kennedy School of Government.
  3. Bar-Eli, Michael & Azar, Ofer H. & Ritov, Ilana & Keidar-Levin, Yael & Schein, Galit, 2005. "Action bias among elite soccer goalkeepers: The case of penalty kicks," MPRA Paper 4477, University Library of Munich, Germany.
  4. Cooper, David J. & Sutter, Matthias, 2011. "Role Selection and Team Performance," IZA Discussion Papers 5892, Institute for the Study of Labor (IZA).
  5. Baron, Jonathan & Ritov, Ilana, 2004. "Omission bias, individual differences, and normality," Organizational Behavior and Human Decision Processes, Elsevier, vol. 94(2), pages 74-85, July.
  6. Azar, Ofer H., 2014. "The default heuristic in strategic decision making: When is it optimal to choose the default without investing in information search?," Journal of Business Research, Elsevier, vol. 67(8), pages 1744-1748.
  7. Roy, Devjani & Zeckhauser, Richard, 2013. "Ignorance: Lessons from the Laboratory of Literature," Working Paper Series rwp13-039, Harvard University, John F. Kennedy School of Government.

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