Probability or time: Effect of presentation format on continuous risky decisions

Abstract

Continuous risky decisions refer to decisions that involve trade-offs among options with persistent risks. People can use the probability of occurrence per unit time (e.g., ‘the probability of occurrence is 1% per month’) or the average time of risk occurrence (e.g., ‘the average occurrence time is 100 months’) to represent continuous risky options. In this study, we examined the effect of the presentation format (i.e., the probability of occurrence per unit time vs. the average time of risk occurrence) on continuous risky decisions in the gain domain and further explored the underlying mechanism. In Study 1 (N = 122), we demonstrated the effect of presentation format on continuous risky decisions and the moderating effect of the magnitude of probabilities. Specifically, when the probabilities were relatively low, compared with the probability of occurrence per unit time, using the average time of risk occurrence to present the continuous risky options led to more risk-averse decisions. However, when the probabilities were relatively high, compared with the probability of occurrence per unit time, the presentation format of the average time occurrence led to more risk-seeking decisions. In Study 2 (N = 136), we found that the moderating effect of the option probabilities on continuous risky decisions was mediated by the subjective attribute-wise difference judgment. In Study 3 (N = 221), we replicated the effect of presentation format on continuous risky decisions in more natural scenarios. The study offered a deep understanding of the mechanism of continuous risky decision-making, and the results were conducive to further developing theories in relevant fields.