What prompts people to engage in extreme sports or other pastimes that could result in serious injury or death? Economics professor Mary Riddel and graduate student Sonja Kolstoe of the Lee Business School set out to find out why people do the crazy things they do.
They found two answers. Some people lack good judgment and engage in dangerous activity without fully understanding the consequences. Others fully understand and find the thrill worth the risk. They also found that as individuals understand the high costs of an activity, they mitigate the risk factors or cease the activity.
Methodology
The researchers wanted to examine how risk-averse people are and their knowledge of the hazards of a particular activity. A sample size of 500 volunteers was used for the experiment. A student control group did not engage in any high-risk activity; another group engaged in risky recreational activities such as amateur auto racing, rock climbing, and SCUBA diving.
Subjects were asked to imagine that they had been diagnosed with a disease that, without treatment, would be fatal within a year. The subjects were offered two treatment options. Treatment A gave patients a 95 percent chance of living five more years and a five percent chance of dying within the next year. Treatment B gave them a 50 percent chance of living 10 more years and a 50 percent chance of dying within the next year.
Results
Responses revealed the subjects' level of risk-aversion and how they assessed the likelihood of survival. If the subject was risk-averse, he or she chose treatment A. Higher risk takers chose option B. Findings show that people who engage in risky recreational activities have different mortality-risk preferences than the average person. Amateur auto racers were the most mortality-risk loving, followed by SCUBA divers, rock climbers, and the control group. The racers and SCUBA divers derived benefit from the sports' potential for fatality. "Safe" activities such as gardening or cooking wouldn't satisfy their need to take risks.
The Takeaway
Do risky recreationists consider the likelihood of mortality the same way average people do or are they overly optimistic about surviving? The researchers found the control group more optimistic about survival while the risk takers weighed their options more rationally. "Average risky recreationists compare the benefit derived from the risky recreation to any costs. When benefits exceed costs, they engage in the risky activity," Riddel said.
Mary Riddel is chair of the economics department and a Beam Research Fellow in the Lee Business School. Sonja Kolstoe received a master's degree in economics from UNLV and is now a doctoral student in environmental studies at the University of Oregon. This study will be published in the next edition of the Journal of Risk and Uncertainty.
