Document Type
Article
Publication Title
The Economic Journal
Publication Date
11-1997
ISSN
1468-0297
Page Number
1657
Keywords
divergent risk, mad-cow disease, risk evidence
Disciplines
Environmental Law | Law
Abstract
Receipt of multiple sources of risk information ideally should foster sounder decisions under uncertainty. This paper’s original survey results for environmental risks suggest that the learning process is reasonable in many respects, but it does not accord with a rational Bayesian learning model. Divergent risk assessments from different sources produce extreme violations of rationality, as there is inordinate weight on the high risk assessment. This alarmist reaction holds for both government and industry information sources. This phenomenon may account for the commonly observed phenomenon of public overreaction to highly publicized risks.
Recommended Citation
W. Kip Viscusi,
Alarmist Decisions with Divergent Risk Information, 107 The Economic Journal. 1657
(1997)
Available at: https://scholarship.law.vanderbilt.edu/faculty-publications/1586