risky shift phenomenon

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An experiment to examine the effects that group behaviour has on risky-decision making; the risky shift phenomenon Abstract The aim of this study is to investigate the effects that being part of a group has on risky decision-making. 33 participants took part and each completed a questionnaire individually, and then again in a group of 3. The questionnaire was made up of 5 real-life risky scenarios, the participants were asked to decide the smallest probability that they found acceptable, 1 in 10 was the most risky, 9 in 10 was the safest answer. The hypothesis was that participants would take greater risks when in groups than as an individual, aiming to provide support for previous studies into this area. The results however did not support the hypothesis. The results propose that being part of a group has no significant effect on risky decision-making. This could show that this study provides studies that oppose the risky shift phenomenon. Introduction When people are in groups, they make decisions about risk differently from when they are alone. The risky shift phenomenon suggests that people are more likely to make a risky decision when in a group as a shared risk reduces individual responsibility. The theory of the risky shift phenomenon was originally put forward by Stoner (1961) contrary to the common belief that people would make more conservative decisions when in a group. Kogan and Wallach (1964) developed a ‘choice dilemma task’ to attempt to measure Stoner’s theory. A large proportion of studies conducted using this method supported the risky shift hypothesis. Wallach, Kogan and Bem (1962) conducted an experiment to examine the effect of social influence when answering risky decisions (See Appendix 1). Wallach, Kogan and Bem found that in 10 of the 12 choice dilemmas that the group examined, the average answer shifted towards a more
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