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Risk-Taking

A number of factors can influence an individual’s propensity to take risks. In particular, developmental differences in reward sensitivity (attraction to money, food, and other rewards), self-control, and mental representation (the mental picture or interpretation) of choices have each been shown to explain greater susceptibility to risk-taking. Developmental differences refer to how people change with age from infancy to old age. This entry will explain how understanding each of these factors (and developmental trends in each of them) can help to explain changes in risk-taking that occur across the life span. This entry first defines key terms relating to risk-taking and then goes on to describe developmental trends in risk-taking and how these trends are explained by the leading psychological theories of risk-taking.

Defining Risk and Risk-Taking

There are distinctions between how laypeople describe a risk and how economists and psychologists think about risk. People who do not study risk may associate risk negatively with feelings of dread or positively by seeing it as an obstacle to overcome. Psychologists define risk-taking as engaging in behaviors that have a possible negative outcome, for example, drinking and driving, which can lead to arrest or a car accident. Economists define risk-taking as choosing options with more variance, for example, choosing to flip a coin with a 50% chance of winning US$200 (otherwise nothing) rather than accepting a sure win of US$100. The outcomes vary when a coin is flipped many times, but a sure thing does not vary. Psychologists and economists agree that people often take risks to obtain positive outcomes (gains) or to avoid negative outcomes (losses). Risks are not to be confused with related concepts such as ambiguity, an incomplete knowledge of probabilities. For gains such as winning money, most adults prefer to avoid taking a risk, and they prefer known risks over ambiguous risks, all else being equal.

The number of outcomes can influence how risky a situation is. For example, a scenario with three different potential outcomes of varying probabilities would be defined as riskier than a scenario with a 50/50 likelihood of two outcomes. Two people may behave differently in response to the same risky scenario due to a multitude of factors. Moreover, both risk perception and risk preference change across development. Risk perception is how people subjectively perceive the magnitude and the characteristics of a risk, whereas reward sensitivity refers to how attracted people are to a reward. Risk perception and reward sensitivity affect risk preference, the tendency to be risk-seeking (one who generally seeks out risks) or risk-averse (one who generally avoids risks).

Developmental Trends in Risk-Taking

Reward sensitivity, risk perceptions, and risk-taking preferences change across the life span. The most real-life risk-taking occurs during adolescence and young adulthood. Adolescents and young adults tend, more than do older adults or children, to engage in risky behaviors such as drug abuse, careless driving, criminal behavior, and unprotected sex. However, it is possible that adolescents simply take more risks than children due to an increased opportunity to take risks during this period rather than an increased preference for risk. Age differences in risk-taking in the laboratory and the real world do not always follow the same age pattern. One reason for this is that risk-taking in the real world is influenced by the opportunity to take risks as well as risk preferences. As children mature and enter adolescence, their actions are less likely to be supervised by parents or other caregivers, such as teachers. This autonomy coincides with increased physical and cognitive capabilities as well as legal freedoms gained during adolescence. Because of the increased opportunity for risk in adolescence and other confounding factors influencing real-life behaviors, it is important to rely on controlled laboratory tasks and neurobiological evidence to fully understand factors influencing risk-taking across the life span.

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