Failing to Learn from Experience about Catastrophes

Meyer, R. (2012). Failing to learn from experience about catastrophes: The case of hurricane preparedness. Journal of Risk and Uncertainty, 45(1), 25‐50.

How do people make decisions about protecting themselves from low-probability, high-consequence events like earthquakes and hurricanes? According to Meyer (2012), anecdotal evidence suggests that we have a short memory for the results of such disasters. For example, although the purchase of flood insurance policies increased dramatically immediately following Hurricane Katrina, the rate quickly dropped to pre-Katrina levels shortly thereafter. In two studies using computer simulations, participants attempted to minimize financial losses as they made decisions about purchasing limited (low-cost) or complete (high-cost) protection in the face of various levels of hurricane threat. Results showed that decisions to invest in future protection depended on the damage participants experienced through lack of protection rather than the damage they avoided by having protection. Meyer explained these findings in terms of reinforcement. First, because such disasters are rare events, it is unlikely that people will feel rewarded for taking protective action at any given time. In addition, since the absence of damage is more difficult to observe than the presence of damage, feeling rewarded for taking protective action depends on the individual’s counterfactual thinking skills – the ability to consider what would have happened had circumstances been different. Meyer notes a number of applications for this research beyond protection from natural disasters, including developing strategies for encouraging patients to continue medication when the consequences of noncompliance are not readily observable.

Making Connections

Counter-factual reasoning
Decision making
Learning theory

Media Supplement

The Centers for Disease Control and Prevention (CDC) is using the threat of a zombie apocalypse to get Americans to prepare for natural disasters, such as earthquakes and floods.