Understanding and Managing 21st Century Risks

The Wharton Risk Management and Decision Processes Center (Wharton Risk Center) of the University of Pennsylvania, and Decision Research received a two-year grant from the Alfred P. Sloan Foundation to advance research on how individuals perceive risk and make decisions with respect to risk preparedness. The Sloan Foundation makes grants primarily to support original research and education related to science, technology, engineering, mathematics, and economics in the belief that a reasoned, systematic understanding of the forces of nature and society, when applied inventively and wisely, can lead to a better world for all.

 

Paul Slovic, President of Decision Research and Professor of Psychology at the University of Oregon, and Howard Kunreuther, James G. Dinan Professor at the Wharton School, University of Pennsylvania and co-director of the Wharton Risk Center, will be working closely with their colleagues to examine risk perceptions of diverse groups over time for a range of low-probability high-consequence hazards, characterize heuristics and biases in decision-making, assess the personal and societal impacts of these perceptions and decisions, and develop risk management strategies that improve both individual and social welfare. The research will comprise analysis of natural language datasets, field surveys and web-based experiments.

New computational linguistics tools have created tremendous potential for the study of human perceptions of risk. In this regard, applying natural language datasets and computational linguistics can reveal how potentially catastrophic hazards are discussed in everyday language. The research team will compare findings from text analysis with findings from psychometric surveys over a wide range of hazards. Web-based experiments will test strategies to motivate individuals to adopt protective measures and to make more thoughtful and consistent judgments about protecting human lives. A behavioral risk audit that recognizes decision-making errors and biases will be the basis for developing effective strategies for preventing, mitigating, and responding to natural disasters and humanitarian crises.

Paul Slovic noted, “The grant will enable a continuation of a productive research collaboration with Kunreuther and his colleagues that began more than 40 years ago.”

Howard Kunreuther commented, “We are very excited about this forthcoming research as it brings Decision Research and the Wharton Risk Center together again in developing implementable strategies for dealing with major problems facing society today.”