Judgment and Decision Making (Sep 2012)
A methodological approach to ratio bias
Abstract
The ratio-bias (RB) phenomenon is considered to provide systematic evidence of irrationality. When judging the probability of a low-probability event, many people judge it as less likely when it is expressed as a ratio of small numbers (e.g., 1-in-10) than when it is expressed as a ratio of large numbers (e.g., 10-in-100). Four experiments show that the phenomenon is increased by the experimental paradigm, which misleads subjects regarding the aim of the task by inducing equal-ratio neglect. One factor is constant across the texts of the Experiment 1--3: a particular sentence that induces subjects to neglect the equal ratio and invites them to express feelings about the outcome of the target event rather than giving a rational answer. This intent is strengthened by the formulation of the question (Experiment 1), which explicitly asks the subject to express the FEELING connected to the lotteries and the absence of a third option (Experiment 1, 4), the right one, which expresses the ``indifference'' between the two options. In Experiment 4, the task lacks only the third option, and, simply by adding the option that allows subjects to express the correct answer, the RB disappears.
