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We investigate whether individuals correctly assess the risk of default of annuity providers and incorporate this information into their decision‐making when purchasing an annuity. To do so, we analyze actual retirement product choices from a large administrative data set from Chile and exploit an exogenous change that decreased the coverage of government guarantees against annuity provider default. If individuals are rational and properly incorporate default risk into their decision process then, before this change, individuals should choose riskier providers that give higher annuity payments. However, we find that individuals' decisions are not influenced by changes in their protection against the risk of provider default. It seems that individuals have been unnecessarily reducing their annuity payments by not incorporating crucial information about their actual risk exposure to default when selecting annuities at retirement. [ABSTRACT FROM AUTHOR]

Research suggests that people's experiences of COVID-19 lockdowns have been detrimental to their lives and wellbeing. The current research compared the experiences and perceptions on health, wellbeing and social interaction of 300 UK adults and 450 adults in California. Individuals reported whether aspects of their life had changed for the better, worse, or not at all during lockdown in April 2020, and what the "best" and "worst" things about lockdown were. There were more similarities than differences in the regional comparison of perceptions of changes in specific aspects of 'health and wellbeing' and 'social interaction'. Both regions reported the same number and nature of best and worst things about lockdown. Overarching themes of 'health, self and wellbeing', 'being with others', and 'concerns with daily living' were identified. Although reports of life changes and the positives and negatives of lockdown were similar across different demographic groups, some differences were present by age, sex, relationship, and family-status. Incorporating knowledge of unified and positive experiences of lockdown can be useful in informing future lockdown restrictions and supporting the population when restrictions are lifted. [ABSTRACT FROM AUTHOR]

RESix experiments studied relative frequency judgment and recall of sequentially presented items drawn from 2 distinct categories (i.e., city and animal). The experiments show that judged frequencies of categories of sequentially encountered stimuli are affected by certain properties of the sequence configuration. We found (a) a "first-run effect" whereby people overestimated the frequency of a given category when that category was the first "repeated" category to occur in the sequence and (b) a dissociation between judgments and recall; respondents may judge 1 event more likely than the other and yet recall more instances of the latter. Specifically, the distribution of recalled items does not correspond to the frequency estimates for the event categories, indicating that participants do not make frequency judgments by sampling their memory for individual items as implied by other accounts such as the availability heuristic (Tversky & Kahneman, 1973) and the availability process model (Hastie & Park, 1986). We interpret these findings as reflecting the operation of a judgment heuristic sensitive to sequential patterns and offer an account for the relationship between memory and judged frequencies of sequentially encountered stimuli. (Contains 4 footnotes, 3 tables, and 2 figures.)

In 5 experiments, we studied precautionary decisions in which participants decided whether or not to buy insurance with specified cost against an undesirable event with specified probability and cost. We compared the risks taken for precautionary decisions with those taken for equivalent monetary gambles. Fitting these data to Tversky and Kahneman's (1992) prospect theory, we found that the weighting function required to model precautionary decisions differed from that required for monetary gambles. This result indicates a failure of the descriptive invariance axiom of expected utility theory. For precautionary decisions, people overweighted small, medium-sized, and moderately large probabilities--they exaggerated risks. This effect is not anticipated by prospect theory or experience-based decision research (Hertwig, Barron, Weber, & Erev, 2004). We found evidence that exaggerated risk is caused by the accessibility of events in memory: The weighting function varies as a function of the accessibility of events. This suggests that people's experiences of events leak into decisions even when risk information is explicitly provided. Our findings highlight a need to investigate how variation in decision content produces variation in preferences for risk. (Contains 9 tables, 6 figures and 1 footnote.)

Any individual's response intended to be random should be as probable as any other. However, 3 experiments show that many people's independent responses depart from the expected chance distribution. Participants responding to instructions of chance and related concepts favor the available options unequally in a similar way. Consequently, in hide-and-seek games, hiders converge on certain locations and are thereby detected beyond chance by seekers who share their preferences. People agree on salient and on nonsalient options, both of which are preferred under different instructions and even in the absence of instructions. Group responses strongly correlate under diverse, even opposing (e.g., competitive and cooperative) directions. Apparently, common default tendencies, combining random and aesthetic choices, are only somewhat modified under specific instructions. Maximal agreement with others is obtained through one's own aesthetic choices. Hence, implementing one's personal aesthetic preferences succeeds in matching others' choices even better than deliberate mutual coordination efforts. These results broadly replicate in 1- and 2-dimensional tasks. Implications of the findings, their possible roots, and their connection to constructs from, e.g., game theory and subjective-complexity research, are discussed. (Contains 1 footnote, 14 tables, and 7 figures.)

A proposed remedy for biased affective forecasts is to base judgments on the actual feelings of people (surrogates) currently experiencing the event, rather than using imagination which conjures an inaccurate vision of the future. Gilbert et al. (2009) forced people to use surrogate reports by withholding all event information, resulting in better predictions. However, in life surrogate information rarely supplants event information--can people effectively integrate both types of information into their judgments? In five studies, respondents predicted the impact of a health state on their own happiness. Respondents incorporated surrogate information into their judgments both in the presence and absence of event information. However, they inappropriately discounted other people's experiences as a valid predictor of their own--particularly in the presence of event information--and imagined their happiness would be different to surrogates' happiness. Excluding preexisting event knowledge, changing the size of the surrogate sample, or increasing the size of the response scale did not alter the adjustment. Although surrogate information improved affective forecasts, its influence was diminished by the presence of event information. (Contains 2 figures, 4 tables and 2 footnotes.)

In 5 experiments, we studied precautionary decisions in which participants decided whether or not to buy insurance with specified cost against an undesirable event with specified probability and cost. We compared the risks taken for precautionary decisions with those taken for equivalent monetary gambles. Fitting these data to Tversky and Kahneman's (1992) prospect theory, we found that the weighting function required to model precautionary decisions differed from that required for monetary gambles. This result indicates a failure of the descriptive invariance axiom of expected utility theory. For precautionary decisions, people overweighted small, medium-sized, and moderately large probabilities--they exaggerated risks. This effect is not anticipated by prospect theory or experience-based decision research (Hertwig, Barron, Weber, & Erev, 2004). We found evidence that exaggerated risk is caused by the accessibility of events in memory: The weighting function varies as a function of the accessibility of events. This suggests that people's experiences of events leak into decisions even when risk information is explicitly provided. Our findings highlight a need to investigate how variation in decision content produces variation in preferences for risk. Keywords: probability, accessibility, risk exaggeration, frequency, precautionary decisions DOI: 10.1037/a0017039

Any individual's response intended to be random should be as probable as any other. However, 3 experiments show that many people's independent responses depart from the expected chance distribution. Participants responding to instructions of chance and related concepts favor the available options unequally in a similar way. Consequently, in hide-and-seek games, hiders converge on certain locations and are thereby detected beyond chance by seekers who share their preferences. People agree on salient and on nonsalient options, both of which are preferred under different instructions and even in the absence of instructions. Group responses strongly correlate under diverse, even opposing (e.g., competitive and cooperative) directions. Apparently, common default tendencies, combining random and aesthetic choices, are only somewhat modified under specific instructions. Maximal agreement with others is obtained through one's own aesthetic choices. Hence, implementing one's personal aesthetic preferences succeeds in matching others' choices even better than deliberate mutual coordination efforts. These results broadly replicate in 1- and 2-dimensional tasks. Implications of the findings, their possible roots, and their connection to constructs from, e.g., game theory and subjective-complexity research, are discussed. Keywords: randomness, hide-and-seek, competition versus cooperation, aesthetics, default tendencies Supplemental materials: http://dx.doi.org/10.1037/0096-1523.35.1.203.supp

The COVID-19 pandemic constitutes a novel threat and traditional and new media provide people with an abundance of information and misinformation on the topic. In the current study, we investigated who tends to trust what type of mis/information. The data were collected in Norway from a sample of 405 participants during the first wave of COVID-19 in April 2020. We focused on three kinds of belief: the belief that the threat is overrated (COVID-threat skepticism), the belief that the threat is underrated (COVID-threat belief) and belief in misinformation about COVID-19. We studied sociodemographic factors associated with these beliefs and the interplay between attitudes to COVID-19, media consumption and prevention behavior. All three types of belief were associated with distrust in information about COVID-19 provided by traditional media and distrust in the authorities' approach to the pandemic. COVID-threat skepticism was associated with male gender, reduced news consumption since the start of the pandemic and lower levels of precautionary measures. Belief that the COVID-19 threat is underrated was associated with younger age, left-wing political orientation, increased news consumption during the pandemic and increased precautionary behavior. Consistent with the assumptions of the theory of planned behavior, individual beliefs about the seriousness of the COVID-19 threat predicted the extent to which individual participants adopted precautionary health measures. Both COVID-threat skepticism and COVID-threat belief were associated with endorsement of misinformation on COVID-19. Participants who endorsed misinformation tended to: have lower levels of education; be male; show decreased news consumption; have high Internet use and high trust in information provided by social media. Additionally, they tended to endorse multiple misinformation stories simultaneously, even when they were mutually contradictory. The strongest predictor for low compliance with precautionary measures was endorsement of a belief that the COVID-19 threat is overrated which at the time of the data collection was held also by some experts and featured in traditional media. The findings stress the importance of consistency of communication in situations of a public health threat. [ABSTRACT FROM AUTHOR]

Parma: EFSA 5 European Food Safety Authority (EFSA). Parma: EFSA 6 European Food Safety Authority (EFSA). They were asked to consider and reflect the academic quality of the EFSA ([5]) and EFSA (2019) guidance documents and to put forward suggestions on what regulatory agencies such as EFSA and the UK Food Standards should do now going forward in this space. The value of social sciences in understanding how experts and non-experts conceptualise, interpret and communicate risk and uncertainty is most evident in the applied world of risk assessment (for a recent review of the issues see, van der Bles et al. 2019). [Extracted from the article]

The attempts to mitigate the unprecedented health, economic, and social disruptions caused by the COVID-19 pandemic are largely dependent on establishing compliance to behavioral guidelines and rules that reduce the risk of infection. Here, by conducting an online survey that tested participants' knowledge about the disease and measured demographic, attitudinal, and cognitive variables, we identify predictors of self-reported social distancing and hygiene behavior. To investigate the cognitive processes underlying health-prevention behavior in the pandemic, we co-opted the dual-process model of thinking to measure participants' propensities for automatic and intuitive thinking vs. controlled and reflective thinking. Self-reports of 17 precautionary behaviors, including regular hand washing, social distancing, and wearing a face mask, served as a dependent measure. The results of hierarchical regressions showed that age, risk-taking propensity, and concern about the pandemic predicted adoption of precautionary behavior. Variance in cognitive processes also predicted precautionary behavior: participants with higher scores for controlled thinking (measured with the Cognitive Reflection Test) reported less adherence to specific guidelines, as did respondents with a poor understanding of the infection and transmission mechanism of the COVID-19 virus. The predictive power of this model was comparable to an approach (Theory of Planned Behavior) based on attitudes to health behavior. Given these results, we propose the inclusion of measures of cognitive reflection and mental model variables in predictive models of compliance, and future studies of precautionary behavior to establish how cognitive variables are linked with people's information processing and social norms. [ABSTRACT FROM AUTHOR]

Here we consider how the relative harms of two nicotine products were communicated in a public health campaign. Following a peer-reviewed evaluation that rated the relative harm of a range of nicotine products relative to the harm of smoking, and which rated the relative harm of vaping as about 5% that of smoking (D. J. Nutt et al., 2014European Addiction Research, 20(5), 218–225), the UK government launched a campaign which transposed these relative harms into relative safety, promoting the message that "vaping is 95% safer than smoking". We discuss the communication issues arising from transposing a measure of relative harms into relative safety and report the results of an experiment which shows that significantly more people correctly appreciated the ratio of the relative harms from smoking and vaping after reading the statement "vaping is 5% as harmful as smoking" than after reading the statement "vaping is 95% safer than smoking". We discuss the policy implications of our findings. [ABSTRACT FROM AUTHOR]

Background: By the end of March 2020, more than a fifth of the world's population was in various degrees of "lockdown" in order to slow the spread of COVID-19. This enforced confinement led some to liken lockdown to imprisonment. We directly compared individual's experiences of lockdown with prisoners' experiences of imprisonment in order to determine whether psychological parallels can be drawn between these two forms of confinement. Methods: Online surveys of adults in lockdown in the UK (N = 300) and California (N = 450) were conducted 4 and 5 weeks into lockdown in each region, respectively. The UK data was then compared to Souza and Dhami's (2010) sample of 267 medium security prisoners in England, and the Californian data was compared to Dhami et al.'s (2007) sample of 307 medium security Federal prisoners in California. We measured the effects of Group (Lockdown v. Prison) on five categories of dependent variables (i.e., activity, social contact, thoughts, feelings, and rule-breaking), controlling for demographic differences between the groups. Results: In both regions, people in lockdown thought significantly less often about missing their freedom, as well as missing their family and friends living elsewhere than did first-time prisoners. However, people in lockdown in both regions were also significantly less engaged in a range of daily activities than were first-time prisoners. Additionally, in both regions, people in lockdown reported feeling more hopeless than first-time prisoners. Conclusion: Although Governments introducing lockdown policies do not intend to punish their citizens as courts do when sending convicted offenders to prison, such policies can have unintended adverse consequences. Psychological parallels can be drawn between the two forms of confinement. [ABSTRACT FROM AUTHOR]

Following the airplane attacks of September 11th, 2001 it is claimed that many Americans, dreading a repeat of these events, drove instead of flying, and that, consequently, there were extra car accidents, increasing the number of fatalities directly caused by the attacks by 1,500. After the Madrid train bombings of March 11th, 2004, Spaniards, like Americans, avoided the attacked mode of travel, but no increase in car travel or fatal accidents resulted. Here we analyze behavioral concomitants of the July 7th 2005 bomb attacks on public transport in London. We find reduced underground train travel and an increase in rates of bicycling and, over the 6 months following the attacks, 214 additional bicyclist road casualties -- a 15.4% increase. Nevertheless we found no detectable increase in car accidents. We conclude that, while fear caused by terrorism may initiate potentially dangerous behaviors, understanding the secondary effects of terrorism requires consideration of the environmental variables that enable fear to manifest in dangerous behaviors. [ABSTRACT FROM AUTHOR]

Stanovich & West argue that their observed positive correlations between performance of reasoning tasks and intelligence strengthen the standing of normative rules for determining rationality. I question this argument. Violations of normative rules by cognitively humble creatures in their natural environments are more of a problem for normative rules than for the creatures.

Financial risky decisions and evaluations pervade many human everyday activities. Scientific research in such decision-making typically explores the influence of socioeconomic and cognitive factors on financial behavior. However, very little research has explored the holistic influence of contextual, emotional, and hormonal factors on preferences for risk in insurance and investment behaviors. Accordingly, the goal of this review article is to address the complexity of individual risky behavior and its underlying psychological factors, as well as to critically examine current regulations on financial behavior. [ABSTRACT FROM AUTHOR]

This article reviews research on the elicitation of consistent, coherent and valid probability forecasts From this a general model of the judgemental forecasting process is developed showing the interdependence of consistency, coherence and validity. The authors describe a forecasting aid which elicits consistent and coherent forecasts and argue that research should now focus on the validity of judgemental forecasting by attempting to identify the characteristics of those individuals who can produce valid judgements. (Reprinted by permission of the publisher.)

Decision-making competence in later adulthood is affected by declines in cognitive skills, and age-related changes in affect and experience can sometimes compensate. However, recent findings suggest that age-related changes in motivation also affect the extent to which adults draw from experience, affect, and deliberative skills when making decisions. To date, relatively little attention has been given to strategies for addressing age-related changes in motivation to promote better decisions in older adults. To address this limitation, we draw from diverse literatures to suggest promising intervention strategies for motivating older recipients' motivation to make better decisions. We start by reviewing the life-span developmental literature, which suggests that older adults' motivation to put effort into decisions depends on the perceived personal relevance of decisions as well as their self-efficacy (i.e., confidence in applying their ability and knowledge). Next, we discuss two approaches from the health intervention design literature, the mental models approach and the patient activation approach, which aim to improve motivation for decision making by improving personal relevance or by building self-efficacy or confidence to use new information and skills. Using examples from these literatures, we discuss how to construct interventions to motivate good decisions in later adulthood. [ABSTRACT FROM AUTHOR]

The study investigated the effects of time spent in prison and quality of life before prison on male, federally sentenced prisoners' adaptations to imprisonment, controlling for sentence length and prison security level. Data consisted of responses on a self-administered survey completed by 712 prisoners. Findings tended to support the independent effects of the indigenous (deprivation) and importation approaches rather than their interaction effects. Time spent in prison had a direct effect on prisoners' participation in programs, their thoughts of needing control over their lives, their feelings of hopelessness, and their disciplinary infractions in prison. Prisoners' quality of life before prison had a direct effect on their participation in programs, their feelings of happiness, and their prison infractions. Finally, time spent in prison and quality of life before prison interacted to affect prisoners' contact with their family and friends. [ABSTRACT FROM PUBLISHER]