How Near-Miss Events Amplify or Attenuate Risky Decision Making

Abstract

I n the aftermath of many natural and man-made disasters, people often wonder why those affected were underprepared, especially when the disaster was the result of known or regularly occurring hazards (e.g., hurricanes). We study one contributing factor: prior near-miss experiences. Near misses are events that have some nontrivial expectation of ending in disaster but, by chance, do not. We demonstrate that when near misses are interpreted as disasters that did not occur, people illegitimately underestimate the danger of subsequent hazardous situations and make riskier decisions (e.g., choosing not to engage in mitigation activities for the potential hazard). On the other hand, if near misses can be recognized and interpreted as disasters that almost happened, this will counter the basic "near-miss" effect and encourage more mitigation. We illustrate the robustness of this pattern across populations with varying levels of real expertise with hazards and different hazard contexts (household evacuation for a hurricane, Caribbean cruises during hurricane season, and deep-water oil drilling). We conclude with ideas to help people manage and communicate about risk.

Good Night, and Good Luck: Perspectives on Luck in Management Scholarship

“…For example, a shared feature of many organizational disasters is the high number of near-misses, successful outcomes in which chance plays a role in averting failures, prior to actual disasters (Perrow, 2011;Starbuck & Farjoun, 2005;Vaughan, 1997). These lucky outcomes are usually interpreted as successes and people do not consider how the same managerial decision could have led to a disaster, boosting a false sense of security and appetite for risk taking (Dillon, Tinsley, Madsen, & Rogers, Forthcoming;Madsen & Desai, 2010;Tinsley, Dillon, & Cronin, 2012 Chance averted failure in the cases of these near-misses, but did not with the eventual disaster. Nevertheless, NASA managers interpreted near-misses as successes and did not consider how near-misses might easily have turned into disasters.…”

Damage to insula abolishes cognitive distortions during simulated gambling

“…These distortions are reliably observed in field studies, e.g., casino environments (8), and are not confined to gambling; illusory control and the gambler's fallacy are observed in stock traders (9), and near misses influence decision-making in occupational settings (10). In the laboratory, these distortions can be elicited with gambling games, allowing the comparison of these biases between different clinical groups.…”

Near-miss events, risk messages, and decision making

“…This research builds on the prior research (Tinsley et al 2012) that examines two types of near-misses: vulnerable nearmisses and resilient near-misses. These two concepts parallel results from Á rvai et al (2006) that found evidence in post-disaster settings of both ''post-exposure wakeup calls'' (i.e., vulnerable near-misses) and ''post-exposure let down'' (i.e., resilient near-misses).…”

“…We define a near-miss as some event where a negative outcome could have happened because of the existence of hazardous conditions, but the negative outcome does not occur largely because of chance (Dillon and Tinsley 2008). Additionally, we deconstruct near-miss events into different types of near-misses based on the saliency of the outcomes (Tinsley et al 2012). Specifically, some near-misses have cues that highlight resilience, i.e., a disaster was successfully avoided and hence it did not feel like a disaster almost happened.…”

“…Other near-misses have cues that highlight danger, i.e., a disaster almost happened. People experiencing these ''vulnerable nearmisses'' reason that a disaster came close to occurring and that encourages them to attend to future hazard warnings and engage in mitigation behavior (Tinsley et al 2012), similar to those that experience direct damage.…”