The neglect of probability, a type of cognitive bias, is the tendency to disregard probability when making a decision under uncertainty and is one simple way in which people regularly violate the normative rules for decision making. Small risks are typically either neglected entirely or hugely overrated. The continuum between the extremes is ignored. The term probability neglect was coined by American legal scholar Cass Sunstein. There are many related ways in which people violate the normative rules of decision making with regard to probability including the hindsight bias, base rate neglect, and the gambler's fallacy. However, rather than incorrectly using probability, in this instance the actor disregards it. According to Swiss author on decision-making and critical thinking Rolf Dobelli, "We have no intuitive grasp of risk and thus distinguish poorly among different threats. The more serious the threat and the more emotional the topic (such as radioactivity), the less reassuring a reduction in risk seems to us."
Studies
Adults In a 1972 experiment, participants were divided into two groups, with the former being told they would receive a mild electric shock and the latter told that there was a 50 percent chance they would receive such a shock. When the subjects' physical anxiety was measured, there was no difference between the two groups. This lack of difference remained even when the second group's chance of being shocked was lowered to 20 percent, then ten, then five. The conclusion: "we respond to the expected magnitude of an event...but not to its likelihood. In other words: We lack an intuitive grasp of probability." Baron (2000) suggests that the bias manifests itself among adults especially when it comes to difficult choices, such as medical decisions. This bias could make actors drastically violate expected-utility theory outcomes in their decision making, especially when a decision must be made in which one possible outcome has a much lower or higher utility but a small probability of occurring (e.g. in medical or gambling situations). In this aspect, the neglect of probability bias is similar to the base rate neglect. American legal scholar Cass Sunstein has cited the history of Love Canal in upstate New York, which became world-famous in the late 1970s owing to widely publicized public claims that abandoned waste was causing medical problems in the area. In response to these concerns, the U.S. federal government set in motion "an aggressive program for cleaning up abandoned hazardous waste sites, without examining the probability that illness would actually occur," and legislation was passed that did not reflect serious study of the actual degree of danger. Furthermore, when controlled studies were publicized showing little evidence that the waste represented a menace to public health, the anxiety of local residents did not diminish. One University of Chicago study showed that people are as afraid of a 1% chance as of a 99% chance of contamination by poisonous chemicals. In another example of near-total neglect of probability, Rottenstreich and Hsee (2001) found that the typical subject was willing to pay $10 to avoid a 99% chance of a painful electric shock, and $7 to avoid a 1% chance of the same shock. They suggest that probability is more likely to be neglected when the outcomes are emotion-arousing. In 2013, Tom Cagley noted that neglect of probability is "common in IT organizations that are planning and estimating projects or in risk management." He pointed out that there are available techniques, such as the Monte Carlo analysis, to study probability, but too often "the continuum of probability is ignored." In 2016, Swiss author on decision-making and critical thinking Rolf Dobelli presented a choice between two games of chance. In one, you have a one in 100 million chance of winning $10 million; in the other, you have a one in 10,000 chance of winning $10,000. It is more reasonable to choose the second game; but most people would choose the first. For this reason, jackpots in lotteries are growing. Dobelli has described the United States Food Additives Amendment of 1958 as a "classic example" of neglect of probability. The law – which prohibited carcinogenic substances in food, no matter how low the probability that they would in fact result in cancer – led to the substitution of those substances by ingredients that, while not causing cancer, stood a far greater chance of causing some sort of medical harm. In 2001, there was widespread panic around the U.S. over shark attacks, even though there was no evidence to show any increase in their occurrence. Legislation was actually enacted to address the issue. Neglect of probability also figures in the purchase of lottery tickets. Cass Sunstein has pointed out that terrorism is effective partly because of probability neglect. "Terrorists show a working knowledge of probability neglect," he wrote in 2003, "producing public fear that might greatly exceed the discounted harm."
Children The probability bias is especially pronounced among children. A 1993 study presented children with the following situation:
Susan and Jennifer are arguing about whether they should wear seat belts when they ride in a car. Susan says that you should. Jennifer says you shouldn't... Jennifer says that she heard of an accident where a car fell into a lake and a woman was kept from getting out in time because of wearing her seat belt, and another accident where a seat belt kept someone from getting out of the car in time when there was a fire. What do you think about this? The study's lead author Jonathan Baron noted in 2000 that subject X responded in the following manner:
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