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How Risky is it, Really?
 

How Risky is it, Really?

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IN THIS SUMMARY...

IN THIS SUMMARY
In How Risky Is It, Really?, David Ropeik discusses how the human brain determines whether a person is at risk and the methods it takes to reach that conclusion. Today, significant advances in neuroscience, economics, psychology, anthropology, and sociology lend new insight into the brain’s perception of risk and help explain why people may overreact to relatively small threats and underestimate the really big ones. According to Ropeik, these Perception Gaps – the difference between fears and actual facts – can be dangerous, and people must learn to better understand their perception of fears in order to reduce them. Ropeik outlines the various risk perception factors the brain uses in hopes that readers will be able to reduce their Perception Gaps and make smarter, safer, and healthier decisions.

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    How Risky is it, Really? How Risky is it, Really? Presentation Transcript

    •  
    • HOW RISKY IS IT, REALLY? Why Our Fears Don’t Match The Facts AUTHOR: David Ropeik PUBLISHER: McGraw-Hill Companies DATE OF PUBLICATION: 2010 280 pages
    • FEATURES OF THE BOOK In How Risky Is It, Really? David Ropeik analyzes the science of fear and risk, explaining in detail the brain’s risk assessment system and how it can result in gaps between perception and fact. Discussing a fairly complex issue in straightforward and engaging language, this book will appeal to professionals hoping to improve their decision-making skills and rationality.
    • THE BIG IDEA
      • How Risky Is It, Really? explains how the human brain determines whether a person is at risk and the methods it takes to reach that conclusion.
      • The brain’s fear center is the amygdala, which sends out commands to various parts of the body when under stress.
      • These stresses are meant to last only as long as it takes an individual to decide to flee, fight or freeze.
      • The brain uses risk perception factors to quickly decide whether or not something poses an immediate threat to its safety. ..
    • INTRODUCTION In How Risky Is It, Really? , David Ropeik discusses how the human brain determines whether a person is at risk and the methods it takes to reach that conclusion. Today, significant advances in neuroscience, economics, psychology, anthropology, and sociology lend new insight into the brain’s perception of risk and help explain why people may overreact to relatively small threats and underestimate the really big ones. According to Ropeik, these Perception Gaps – the difference between fears and actual facts – can be dangerous, and people must learn to better understand their perception of fears in order to reduce them.
    • THE BRAIN’S RESPONSE TO FEAR The human brain is hardwired to fear first and to think second; conscious awareness of a reaction seems to take place only after the reaction has actually occurred. The brain’s perception that you might die is what triggers the “ Fight or Flight or Freeze ” scenario: most individuals will choose to fight, flee, or freeze when confronted with a fear. At this point, physiological changes pick up: the heart speeds up, breathing becomes rapid, some blood vessels constrict while others loosen up, digestion shuts down, some peripheral vision is lost, and the range of hearing narrows.
    • THE BRAIN’S RESPONSE TO FEAR The human brain contains some “built-in” fears that rank among the top human phobias. These relate to fears of the unknown, such as the fear of the dark, as well as to fears of things that have the potential to kill, such as snakes, heights, spiders, being underwater, and tight spaces. It is also common for humans to fear being alone because they are socially oriented. Finally, humans can “catch” fear from other people who look afraid or upset, the logic being that if someone else is afraid, they should be afraid too.
    • RISK PERCEPTION FACTORS 1.) Trust. Humans are social creatures who rely upon one another for survival, and trust therefore plays a significant role in risk assessment. Oxytocin – a hormone that reduces stress and creates feelings of relaxation and trust – is released during positive social bonding experiences. 2.) Risk versus benefit. Humans instinctively compare the risks and the benefits of a decision, oftentimes playing down the risk in order to better enjoy the benefits. The greater the benefit, the more willing individuals are to downplay the associated risks; this helps explain why some people work dangerous jobs for higher pay. Conversely, if there is a large risk and a small benefit, individuals are less likely to take the risk.
    • RISK PERCEPTION FACTORS 3.) Control. Humans have a strong desire to maintain control over situations that affect them; when they are not in control of a given situation, they are more afraid. Studies show that individuals who have some degree of control during a traumatic event are less likely to develop post-traumatic stress disorder (PTSD) than individuals who have no control. 4.) Choice. Choice boils down to whether an individual is able to choose taking a risk or whether the individual is forced to take the risk. Risks that are imposed cause more fear and anxiety than risks that are chosen.
    • RISK PERCEPTION FACTORS 5.) Natural versus human-made risks. In general, people worry less about natural risks than they do about risks that are caused by humans. This can create a large and dangerous perception gap. For example, a 1994 study found that many natural herbal supplements contained significant amounts of lead, mercury, or arsenic. 6.) Pain and suffering. Individuals are more afraid of risks that involve heightened amounts of pain and suffering. This too can lead to hazardous Perception Gaps, which can be evidenced in the United States government’s medical funding choices.
    • RISK PERCEPTION FACTORS 7.) Uncertainty. The amygdala becomes more active when it is presented with an unfamiliar and possibly threatening situation. Therefore, the more unfamiliar an individual is with a situation, the more he or she is likely to fear it. This risk factor causes humans to follow the adage “better safe than sorry.” 8.) Catastrophic versus chronic risks. Catastrophes are more worrisome to humans for three reasons: 1.) they are big, 2.) they tend to happen all at once, and 3.) they are disastrous. Chronic occurrences, on the other hand, are spread out over space and time, and while unfortunate, they do not have the same immediately devastating appearance as catastrophes.
    • RISK PERCEPTION FACTORS 9.) Whether individuals think it can happen to them . When people perceive that a risk will likely affect them, the risk will feel bigger and they will be more afraid of it. This makes sense biologically because the amygdala does not worry about someone else’s body – it only responds when a risk threatens its own body. 10.) New versus familiar risks. New risks are more frightening than familiar risks that individuals can understand and qualify. For example, during the 1999 West Nile outbreak in the United States, the news media consistently used terminology that identified it as “exotic” and “different.”
    • RISK PERCEPTION FACTORS 11.) If the risk affects children. If a risk specifically affects children, humans are increasingly troubled by it. Ropeik attributes this perception to evolution: humans have a genetic drive to survive and procreate, and the survival of a species hinges on ensuring the survival of its children. When children are threatened, people implicitly understand the entire species to be threatened. 12.) Personification. When a risk is given a human face, peoples’ concern or anxiety about the risk will be raised. When the same risk is represented by an idea, a nation of people, or an impersonal statistic, however, the same individuals are often less concerned.
    • RISK PERCEPTION FACTORS 13.) Fairness. Risks that affect the underprivileged, the disabled, and those who cannot stand up for themselves are considered particularly terrible because they do not seem fair. It is unnerving for many people to witness an event, product, or person unfairly abusing someone else; it causes them to consider the possibility of something unfair happening to them. Humans prefer to view the world as being fair, and they are unsettled when this vision is disrupted.
    • BOUNDED RATIONALITY 1.) Categorization. The first tool used by the human mind, categorization is also known as stereotyping or “representativeness.” Categorization occurs when the brain applies what it already knows about a subject to something the individual encounters that falls within the same category. For example, when confronted with something labeled as a chemical, the human mind raises judgments based on its previous experiences with chemicals, such as “toxic,” “pollution,” and “dangerous.” While this can be helpful in some emergency situations, it can be detrimental in others.
    • BOUNDED RATIONALITY 2.) Awareness/recall effect. The awareness/recall effect involves an individual’s ability to recall information that can be used to categorize. Events that happened frequently are much easier to recall than ones that happen rarely, so the brain will recall the most common experiences that relate to the current situation. However, the amygdala stores memories of frightening events in order to avoid similar situations in the future. If a related traumatic or vivid memory exists that relates to the current situation, the mind will recall that memory first, not the most frequently occurring events.
    • BOUNDED RATIONALITY 3.) The framing effect. The way humans perceive something is largely based on the way it is presented to them. This process, called framing, presents information in a way that elicits specific judgments or opinions. People can frame information by leaving out certain statistics or including new ones, or they can frame it through the use of semantics.
    • BOUNDED RATIONALITY 3.) The framing effect. The way humans perceive something is largely based on the way it is presented to them. This process, called framing, presents information in a way that elicits specific judgments or opinions. People can frame information by leaving out certain statistics or including new ones, or they can frame it through the use of semantics. 4.) Anchoring and adjustment. The human brain tends to skew numerical values by making estimates based on the first number it sees (the anchor) and adjusting from there. To explain the Perception Gap this tool can create, Ropeik discusses a study in which two groups of individuals were given 40 different causes of death. Each group had to rank the frequency of each cause of death and estimate the number of victims.
    • BOUNDED RATIONALITY 5.) Optimism bias. Humans tend to assume that things will turn out better in the future than statistics actually indicate. People may assume their marriage will last longer than it actually does, that they will live longer than they actually do, or that they have a higher chance of professional success than they realistically do. An ABC News poll taken immediately after the September 11th attacks showcased the optimism bias. When survey participants were asked how concerned they were about future terrorist attacks on the United States, 29 percent said “a great deal”; 45 percent said “somewhat”; 17 percent said “not too much”; and 8 percent said “not at all.”
    • BOUNDED RATIONALITY 6.) Loss aversion. Individuals avoid giving up things they do not need or they know are bad for them because they do not want to experience loss. The feeling of ownership creates value, so relinquishing a possession causes a sense of loss. Loss aversion is one of the key reasons why individuals hold onto stocks longer than they should or why they continue to wear old sneakers.
    • BOUNDED RATIONALITY 7.) Innumeracy. Innumeracy is mathematical illiteracy, and it is more of a roadblock to accurate risk assessment than it is a tool. Many people are not skilled with numbers, particularly when it comes to deciphering and comparing statistics, but innumeracy can be hazardous when making risk assessments. If, for example, an individual has a hard time understanding that one-fifth is the same as 20 percent, then he or she will have to depend more on mental shortcuts or feelings that may lead to inaccurate responses.
    • OVERCOMING THE BRAIN’S RESPONSE TO FEAR There is no doubt that excessive stress is unhealthy and should be avoided as much as possible. Ropeik offers readers the following practical strategies to reduce their levels of anxiety and make healthier, smarter, and safer decisions: Keep an open mind : Emotion-based responses to a perceived threat may feel right, but individuals should keep an open mind so their instincts do not overshadow the facts. Don’t rush : Fear is the brain’s first response, only then followed by rational thought. Individuals should avoid jumping to conclusions and give their brain time to logically think about an issue or decision.
    • OVERCOMING THE BRAIN’S RESPONSE TO FEAR Get more information : The less information an individual has, the greater role their instincts will play in decision making – and the greater the chance of falling victim to a Perception Gap. The solution is to learn more about the issue. Questions to ask about any risk : What does the risk mean? It is hazardous? If so, how hazardous, to whom, and in what ways? How much exposure is hazardous? Over what length of time? How could an individual be exposed?
    • OVERCOMING THE BRAIN’S RESPONSE TO FEAR Remember the challenge of innumeracy : Identify both the relative risk and the actual risk. If the risk of being bitten by a raccoon doubled last year (relative risk), then the individual should find out the actual risk – for instance, that the risk went from 1 in 500,00 to 2 in 500,000. Individuals should also know what the outcome of a risk is – Is it a 1 in 5,000 chance of dying from diabetes or contracting diabetes? – and whether the statistic is per year or per lifetime. Think about trade-offs : The majority of risky choices involve trade-offs, some of them with benefits and some of them with other risks. Individuals should rationally weigh each possible outcome before making a decision.
    • OVERCOMING THE BRAIN’S RESPONSE TO FEAR Think for oneself : Humans also suffer from confirmation bias, in which they only seek out information that confirms what they already believe. If they do this, they will never learn anything new, including essential facts. Don’t always stick with the group : Individuals tend to agree with those around them; this is done to gain acceptance into the group and to strengthen it. Mindless agreement, however, can lead to risky perception gaps, and people should always consider different perceptions of the issue to understand it fully.
    • OVERCOMING THE BRAIN’S RESPONSE TO FEAR Be a smarter news consumer : It is the news media’s job to make things sound more dramatic than they actually are, and therefore it is common for particular aspects of a story to be emphasized. People should remember that many normal, pleasant things going on in the world are not being reported, and that it is important to diversify their news sources in order to gain a broader perspective. Think about how humans think : Knowing, remembering, and understand the ways the brain cuts corners and makes judgments will help individuals make more rational and thoughtful decisions. .
    • BusinessSummaries.com is a business book Summaries service. Every week, it sends out to subscribers a 9- to 12-page summary of a best-selling business book chosen from among the hundreds of books printed out in the United States. For more information, please go to http://www.bizsum.com. ABOUT BUSINESSSUMMARIES