Decision-making competence predicts domain-specific risk attitudes.

Joshua A Weller,Caleb Randolph,Andrea Ceschi

doi:10.3389/fpsyg.2015.00540

Abstract

Decision-making competence (DMC) reflects individual differences in rational responding across several classic behavioral decision-making tasks. Although it has been associated with real-world risk behavior, less is known about the degree to which DMC contributes to specific components of risk attitudes. Utilizing a psychological risk-return framework, we examined the associations between risk attitudes and DMC. Italian community residents (n = 804) completed an online DMC measure, using a subset of the original Adult-DMC battery. Participants also completed a self-reported risk attitude measure for three components of risk attitudes (risk-taking, risk perceptions, and expected benefits) across six risk domains. Overall, greater performance on the DMC component scales were inversely, albeit modestly, associated with risk-taking tendencies. Structural equation modeling results revealed that DMC was associated with lower perceived expected benefits for all domains. In contrast, its association with perceived risks was more domain-specific. These analyses also revealed stronger indirect effects for the DMC → expected benefits → risk-taking path than the DMC → perceived risk → risk-taking path, especially for behaviors that may be considered more maladaptive in nature. These results suggest that DMC performance differentially impacts specific components of risk attitudes, and may be more strongly related to the evaluation of expected value of a specific behavior.

Highlights

Choices that are based on sound decision-making principles may not always lead to the desired outcome, appropriately applying these rules can substantially increase the likelihood that positive outcomes will outnumber negative ones (Hastie and Dawes, 2010)
In contrast to prior studies that have reported associations between Decision-making competence (DMC) and risk taking, the current study investigated how DMC relates to specific risk evaluations, which are believed to influence one’s risk-taking intentions, within the psychological risk-return model across a variety of domains
Associations between Risk Taking, Risk Perceptions, and Expected Benefits As shown in Table 3, risk perceptions associated with a particular domain were inversely, and most strongly, related to risk taking in that domain

Summary

Introduction

Choices that are based on sound decision-making principles may not always lead to the desired outcome, appropriately applying these rules can substantially increase the likelihood that positive outcomes will outnumber negative ones (Hastie and Dawes, 2010). Given the apparent domain-specificity of risk-taking behavior (e.g., Weber et al, 2002; Hanoch et al, 2006), we examined the degree to which individual differences in DMC are associated with risk taking, perceived risk, and perceived expected benefits across six domains. In contrast to prior studies that have reported associations between DMC and risk taking, the current study investigated how DMC relates to specific risk evaluations, which are believed to influence one’s risk-taking intentions, within the psychological risk-return model across a variety of domains. Guided by past research and theory, we propose that DMC may more strongly relate to the perceived expected benefits (i.e., involving tradeoffs between positive and negative consequences) of a particular activity than an activity’s perceived riskiness (i.e., involving perceptions of uncertainty)

Methods

Results

Discussion

Conclusion