Reconciling predictions of decision making under risk: Insights from a reconceptualized model of risk behaviour
Abstract
Reports on a study that examines a model of risk behaviour in which the effects of risk propensity and problem framing are jointly evaluated. Managers from 58 oil industry organizations were presented with hypothetical business decisions involving significant gains and losses, and asked to choose between action alternatives resulting in certain outcomes or probabilistic outcomes. Also evaluates the notion that tendencies towards risk taking are complex, reflecting personality traits, habits and experience. There was support for a historical basis for risk propensity, but risk preferences were not found to be influential. Further, although both risk propensity and problem framing were found to be significant predictors of risk behaviour, there was no support for prospect theory predictions. For researchers, suggests the need to incorporate individual differences into models of risk behaviour. For organizations, suggests the need for management attention to members’ risk experiences.
Keywords
Citation
Pablo, A.L. (1997), "Reconciling predictions of decision making under risk: Insights from a reconceptualized model of risk behaviour", Journal of Managerial Psychology, Vol. 12 No. 1, pp. 4-20. https://doi.org/10.1108/02683949710164217
Publisher
:MCB UP Ltd
Copyright © 1997, MCB UP Limited