What's Risk Got to Do with It?
Considering a settlement? Conducting a risk analysis? Pay attention to those cognitive biases.
From Psychology today -- 10 Ways We Get the Odds Wrong
Our brains are terrible at assessing modern risks. Here's how to think straight about dangers in your midst.
The human brain is exquisitely adapted to respond to risk—uncertainty about the outcome of actions. Faced with a precipice or a predator, the brain is biased to make certain decisions. Our biases reflect the choices that kept our ancestors alive. But we have yet to evolve similarly effective responses to statistics, media coverage, and fear-mongering politicians. For most of human existence, 24-hour news channels didn't exist, so we don't have cognitive shortcuts to deal with novel uncertainties. . . .
Our emotions push us to make snap judgments that once were sensible—but may not be anymore.
I. We Fear Snakes, Not Cars -- Risk and emotion are inseparable.
II. We Fear Spectacular, Unlikely Events -- Fear skews risk analysis in predictable ways.
III. We Fear Cancer But Not Heart Disease -- We underestimate threats that creep up on us.
IV. No Pesticide in My Backyard—Unless I Put it There -- We prefer that which (we think) we can control.
V. We Speed Up When We Put Our Seat belts On -- We substitute one risk for another.
VI. Teens May Think Too Much About Risk—And Not Feel Enough -- Why using your cortex isn't always smart.
VII. Why Young Men Will Never Get Good Rates on Car Insurance -- The "risk thermostat" varies widely.VIII. We Worry About Teen Marijuana Use, But Not About Teen Sports -- Risk arguments cannot be divorced from values.
IX. We Love Sunlight But Fear Nuclear Power -- Why "natural" risks are easier to accept.
X. We Should Fear Fear Itself -- Why worrying about risk is itself risky.
