THE OBJECTIVE ASSESSMENT OF RISK TENDENCY AS A PERSONALITY

DIMENSION

Víctor J. Rubio*
José Santacreu
José Manuel Hernández

University Autónoma of Madrid

*Correspondence to author: Dr. Víctor J. Rubio. Facultad de Psicología, Universidad

Autónoma de Madrid, 28049, Madrid (Spain). e-mail: victor.rubio@uam.es
 The objective assessment of the risk tendency as a personality dimension

1. Theoretical background

Is now the best moment for selling the stokes, or would it be better to hold on a little bit

longer? The traffic light is nearly red; do you have enough time to cross over? Everyone will

agree on the fact that in these situations risk is involved. However, a unique definition of risk

is far from being universally accepted (Nicholson, Soane, Fenton-O’Creevy & Willman,

2005).

Following Yates & Stone (1992), the risk construct entails three critical elements:

potential losses, the significance of losses, and the uncertainty of losses. We would also add

another previous (implicit) element: a decision-making context. Risk regards to a situation in

which a person has several alternatives for acting not all of them produce outcomes as

satisfactory as desired. Thus, the worth of each available alternative is the result of the risk

and some other considerations that give value (success or failure) to the decision.

Approaches to the study of risk taking behavior (RTB) have also depicted the diversity of

conceptualizations of risk. For instance, the traditional Decision Theory approach to the study

of RTB has been focused on the characteristics of the situations, ignoring interpersonal

differences and studying average behavior. Some other approaches, however, have focused on

cross-situational consistency of individuals’ risk tendency. These approaches have also

produced differences in assessment issues. For instance, one of the most common research

paradigms has looked at choice behavior in experimental situations using lotteries or games.

The traditional study entails showing a set of multi-outcome lotteries with the same expected

value but different prize distribution. Each lottery involves drawing one ticket (see Lopes,

1987, for her proposal of experimental lotteries). Usually, subjects will choose the preferred

lottery on which to bet when they are presented in pairs. Another format is that individuals

have to price the lottery (to choose the smallest amount of money for which they would sell

the chance of playing each lottery).

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V. Rubio, J. Santacreu, J.M. Hernández

Even though the risk assessment procedures mentioned below are task based, they are not

free of problems. Firstly, they would not be considered as objective tests due to the lack of

accomplishment of the main characteristic regarding this way of assessing Cattell posed,,

namely, the absence of “motivational distortion” (Cattell, 1958; Cattell & Warburton, 1967).

Secondly, they have been questioned as a representation of how individuals behave in

naturalistic situations (Wagenaar, 1988). Thirdly, none of them has been designed in a context

of a theory of personality. In most of the cases individual differences have been vaguely

embraced as risk attitudes that are defined in terms of the curvature -concave (risk averse) or

convex (risk seeker)- of the utility function. At most, a few authors have connected individual

differences to motivational aspects, such as Atkinson and his colleagues (Atkinson, 1957,

1983; Atkinson & Litwin, 1960), or Schneider and Lopes (1986).

There are some other approaches that are more focused on personality aspects of RTB that

have produced significant instruments. One of the first is the Kogan-Wallach Choice

Dilemmas Questionnaire (Kogan & Wallach, 1960, 1964; Wallach, Kogan & Bem, 1962). It

consists of 12 situations representing a choice dilemma between a risky and a safe course of

action. Subjects should select the probability level for the risk alternative success that would

make it sufficiently attractive to be chosen. These authors also developed the Chance Bets

Instrument (Kogan & Wallach, 1964) which consists of 66 pairs of dice bets varying the

probabilities of winning and losing, and the amounts of money to be won or lost (with the

same expected value EV=0). Individuals could choose the bet they preferred to play. More

recently Weber, Blais & Betz (2002) have developed a risk attitude scale that consists of 8-

item subscales in four content domains (health/safety, ethical, social, and recreational risks)

and two 4-item subscales (investment and gambling) for financial risk taking. Nicholson et al

(2005) have also developed another instrument which assesses the reported frequency of risk

behaviors in six different domains (recreation, health, career, finance, safety and social).

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 The objective assessment of the risk tendency as a personality dimension

Probably, the most well-known instrument for assessing RTB is the Zuckerman’s

Sensation Seeking Scale (SSS, Zuckerman, 1979; Zuckerman, Eysenck & Eysenck, 1978).

The scale consists of four subscales (Thrill and adventure seeking, Experience seeking,

Disinhibition, and Boredom susceptibility). Its widespread use has produced an amount of

psychometric and cross-cultural data and it has become the most frequent instrument for

assessing risk taking.

However, the major problem the assessment of RTB has to tackle is the fact that there is a

lack of high cross-situational consistency among measures and domains of risk tendency

(Bromiley & Curley, 1992, MacCrimmon & Wehrung, 1986; Schoemaker, 1990; Slovic,

1964; Soane & Chmiel, 2005; Weber, et al., 2002; Weber & Milliman, 1997). Currently, even

though inventories present better interconsistency indexes, it would be, in part, due to the use

of equivalent questionnaire items (Zuckerman, 1979b).

2. Three tests for an objective personality assessment of risk-taking behavior

The authors have developed three computerised task-based tests for an objective

assessment of the risk tendency construct: The Betting Dice Test (BDT), The Roulette Test

(RT), and The Crossing the Street Test (CtST) (Arend, Botella, Contreras, Hernández &

Santacreu, 2003; Hernández, Rubio, Revuelta y Santacreu, in press; Rubio, Santacreu &

Hernandez, 2004; Santacreu, Rubio, & Hernández, in press, Santé & Santacreu, 2001).

The BDT consists of a task in which individuals have to bet on one alternative out of four

in order to estimate the result of the sum of two dice: More than 4, More than 7, More than 9,

a straight bet on Number 12 (see Figure 1). Each alternative is associated to a prize: 1, 2, 5,

and 30 points, respectively. Subjects are encouraged to obtain as many points as possible.

Individuals have to make their bet but are not informed about the numbers of trials (10) nor

the results supposedly obtained for each of their bets. It is assumed that the choice of an

option with a higher probability (though a lower prize) is a more conservative choice than the

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V. Rubio, J. Santacreu, J.M. Hernández

choice of a highly improbable alternative. Thus, the lower the score, the more conservative

the risk tendency is.

The RT is similar to the BDT. In this case subjects have to bet on one out of four options

of the game of roulette: Thirty Numbers (from 1 to 30), Fifteen Numbers (even numbers from

2 to 30), Six Numbers (from 31 to 36), and a straight bet (17) (see Figure 2). Prizes,

instructions, lack of feedback, system messages, and scoring are the same as above.

The CtST consists of a task in which individuals should decide where to cross a

pedestrian from one side of a road to another in order to reach a chemist (see Figure 3). The

point is that the pedestrian should get to the chemist as quickly as possible but without

causing a car crash or being knocked down. The pedestrian is moved by clicking over the

arrow keys displayed and he should get to the chemist on the other side of the road in front of

the left side of the screen, which is the starting position. In the beginning, cars run from the

left to the right and the arrows are not active. After 10 seconds, the road is “veiled”. Thus, no

car can be seen. Then, subjects have to decide where the pedestrian will cross bearing in mind

the fact that the closer to the left corner of the screen they decide to cross, the less they will be

able to see if a car is coming. To the contrary, the further they are from the left corner, the

longer they will spend. It is assumed that participants are greater risk-takers the closer to the

left side of the screen that they decide to cross. Subjects have 10 trials and they are not

informed about any sort of accident they might have produced. Risk score is equal to the

average of the distance from the right side of the screen in a horizontal axis.

PLEASE INSERT FIGURES 1, 2, 3

The tests have shown satisfactory internal consistency as well as an acceptable temporal

stability, as shown in Table 1.

PLEASE INSERT TABLE 1

3. Empirical validation of the tests

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 The objective assessment of the risk tendency as a personality dimension

Three pieces of research have been carried out in order to determine the validity of the

tests proposed. Firstly, 233 university graduates were assessed using the three tests in order to

establish the relationship among them (Rubio, Contreras, Hernandez & Santacreu, submitted).

The results show that the correlation between the two betting tests were r = .787 (p < 0.01).

The correlation between the CtSTand the BDT and the RT were r = .569 and r = .508,

respectively (p < 0.01). These results support the idea of the convergent validity of the tests.

Secondly, a broad study was carried out in order to test the feasibility of the risk tests

to discriminate the guessing tendency individuals show in a multiple option test as a criterion

for validating the instruments (Rubio, Hernandez & Santacreu, submitted). 4,966 applicants to

an ab initio air traffic control (ATC) training course were assessed using a test battery which

included, among others, the RT and the CtST, as well as a four-option test about basic

knowledge of ATC. The applicants were informed that the score of this test was going to be

the sum of the right responses minus 1/3rd of the errors. The guessing tendency was estimated

according to the number of errors and omissions that individuals showed in the multiple-

option test. Subjects were classified in five groups from highly conservatives to high risk

takers, according to the risk test scores. A discriminant analysis was carried out using the two

risk tests as discriminant variables and the guessing tendency scores as the classification

variable. Results showed a significant discrimination among groups for both variables.

Finally, a predictive validation study was carried out (Santacreu, et al., in press). For

this, 6,123 applicants for an ab initio ATC training course were assessed using a test battery

which included the BDT and the CtST as well as tests for assessing another personality and

aptitude dimensions. 95 applicants were selected for the ATC training program which

consisted of five modules: Basic Knowledge (BK), Area Control Unit (ACU), Approach

Control Unit (ApCU), Aerodrome Control Unit (AeCU), and No-ATS unit (NATS). The final

scores of these five modules were used as criteria to test the predictive validity of the

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V. Rubio, J. Santacreu, J.M. Hernández

instruments. Results showed that the range restriction corrected R of the complete test battery

was reasonably high for the five modules. Regarding the risk tests, the BDT showed

significant standardized β for ACU and ApCU. The CtST showed significant coefficients for

ACU, ApCU, AeCU, and NATS. The corrected correlations between the BDT and CtST

scores, and the training program module scores are shown in Table 2.

PLEASE INSERT TABLE 2

4. Discussion

Risk tendency looks at a construct which awakens more interest than agreement. The

problem of how to measure it is directly related to how it is understood. In this chapter, we

have assumed that risk refers to a situation in which the person has to choose from different

alternatives, each one having potential losses or gains characterized by their uncertainty. It is

thought that a person who opts for a less probable alternative than the others would be called

riskier. From this point of view, can we identify whether one person is more prone to a risk

decision than another? Moreover, can we predict who will behave as a risk taker in future

situations? To answer this question demands previously looking into whether or not risk

contexts are equivalent. In other words, is there a cross-situational consistency in RTB?

Research does not provide conclusive evidence about that, though we can find classes of

behavior which tend to covariate. One explanation could be that situations impose most of the

variance of behavior. Thus, an individual who usually makes risky business decisions would

not bet on a lottery. Some authors (Santacreu, Rubio & Hernandez, 2004) have suggested that

personality might be responsible for individuals’ behavior if the situation does not impose a

particular “correct” response (for instance, if the others expect someone to behave as riskier in

business or if the previous results when doing so had been highly profitable). The assessment

of the idiosyncratic way a person has when facing an uncertain situation demands a context in

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 The objective assessment of the risk tendency as a personality dimension

which individuals do not have any experience or any particular response is particularly

reinforced.

5. Final appraisal

Despite what has been said, RTB has been mainly assessed by means of questionnaires,

like almost all personality dimensions. In them, people are asked about how prone they are to

be involved in activities associated to risk or to what extent they observe speed restrictions

when driving. At most, people are asked about how many traffic violations they have

committed in the past month or if they have been involved in a car crash. This way of

assessment presents serious restrictions. Firstly, self-report measures are subjected on

voluntary and non-voluntary biases (Kubinger, 2002;, Viswesvaran & Ones, 1999). On the

other hand, there are limitations in predicting future behavior. This is particularly true, the

broader the personality trait is (Paunonen, Haddock, Forsterling & Keinonen, 2003).

The individuals’ self-report based assessment of personality dimensions contrasts with the

important RTB research tradition of using task-based tests. Based on this tradition and on the

idea that what people say about themselves does not necessarily coincide with what they

really do, the authors have developed a set of objective task-based tests for assessing RTB

that have shown their feasibility as well as adequate psychometric properties which allow us

to propose them as an alternative to the traditional assessment of this construct.

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Table 1: Internal consistency and temporal stability of the risk-taking objective tests

BDT RT CtST
Cronbach’s
.835 .815 .966
α
Test-retest .600 .430 Not
(one day) (one year) available

BDT: Betting Dice Test. RT: Roulette Test. CtST: Crossing the Street Test

Table 2: Corrected correlations between Risk-taking tests and the Air Traffic Control training
course scores

Training Course units BDT CtST

Basic Knowledge -.229 -.200
Area Control -.295 -.082
Approach Control -.165 -.403
Aerodrome Control -.089 -.193
No-ATS -.078 -.153

BDT: Betting Dice Test. RT: Roulette Test. CtST: Crossing the Street Test

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 The objective assessment of the risk tendency as a personality dimension

Figure 1: The test screen of the Betting Dice Test

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V. Rubio, J. Santacreu, J.M. Hernández

Figure 2: The test screen of the Roulette Test

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 The objective assessment of the risk tendency as a personality dimension

Figure 3: The test screen of the Crossing the Street Test

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