Risk

John Adams

• Publisher: Routledge
• Year: 2002
• ISBN:
  9781135371159
• Edition: 1
• Topic: Ciencias físicas
• Subtopic: Geografía

Risk compensation postulates that everyone has a "risk thermostat" and that safety measures that do not affect the setting of the thermostat will be circumvented by behaviour that re-establishes the level of risk with which people were originally comfortable. It explains why, for example, motorists drive faster after a bend in the road is straightened. Cultural theory explains risk-taking behaviour by the operation of cultural filters. It postulates that behaviour is governed by the probable costs and benefits of alternative courses of action which are perceived through filters formed from all the previous incidents and associations in the risk-taker's life.; "Risk" should be of interest to many readers throughout the social sciences and in the world of industry, business, engineering, finance and public administration, since it deals with a fundamental part of human behaviour that has enormous financial and economic implications.

Chapter 1
Risk: An Introduction

One of the pleasures of writing a book about risk - as distinct from one about an esoteric subject such as brain surgery or nuclear physics - is that one has a conversation starter for all occasions. Everyone is a true risk "expert" in the original sense of the word; we have all been trained by practice and experience in the management of risk. Everyone has a valid contribution to make to a discussion of the subject.

The development of our expertise in coping with uncertainty begins in infancy. The trial and error processes by which we first learn to crawl, and then walk and talk, involve decision-making in the face of uncertainty. In our development to maturity we progressively refine our risk-taking skills; we learn how to handle sharp things and hot things, how to ride a bicycle and cross the street, how to communicate our needs and wants, how to read the moods of others, how to stay out of trouble. How to stay out of trouble? This is one skill we never master completely. It appears to be a skill that we do not want to master completely.

The behaviour of young children, driven by curiosity and a need for excitement, yet curbed by their sense of danger, suggests that these junior risk experts are performing a balancing act. In some cases it is a physical balancing act; learning to walk or ride a bicycle cannot be done without accident. In mastering such skills they are not seeking a zero-risk life; they are balancing the expected rewards of their actions against the perceived costs of failure. The apprehension, determination and intense concentration that can be observed in the face of a toddler learning to toddle, the wails of frustration or pain if it goes wrong, and the beaming delight when it succeeds - are all evidence that one is in the presence of a serious risk-management exercise.

Most decisions about risks involving infants and young children are taken by adults. Between infancy and adulthood there is a progressive handing over of responsibility. Adults are considered responsible for their actions, but they are not always considered trustworthy or sufficiently well informed. A third tier of responsibility for the management of risk consists of various authorities whose role with respect to adults is similar to that of adults with respect to children. The authorities are expected to be possessed of superior wisdom about the nature of risks and how to manage them.

The news media are routinely full of stories in which judgement is passed on how well or badly this expectation is met. Consider an ordinary news day chosen at random - 28 January 1994, the day this sentence was written. A perusal of that day's papers¹ reveals that the business sections and the sports pages contain virtually no stories that are not about the management of risk. They are all about winning and losing, and winners and losers. The heroes are people who struggled against the odds and won. Prudence and caution, except for the occasional bit of investment advice for old age pensioners, are mocked as boring. The arts pages were full of risk stories within risk stories. A novel, to win critical acclaim, must be novel; cliche and plagiarism are unpardonable sins. Mere technical competence is not enough; suspense and tension must be deployed to catch and hold the attention of the reader. Risk is embodied in great works of art; and, to capture the interest of the arts pages, risks must be taken by their creators. They are interesting only if they are attempting something difficult. Great art risks failure. But to be boring, predictable and safe is to guarantee failure.

What of the features pages? The motoring sections of most of the papers were dominated as usual by articles focused on the performance of cars although the main feature in one was devoted to question of whether or not airbags caused injuries, and another paper ran a small story about a new car seat for children, with the claim that it "reduced the risk by 90%". The life-style section of another ran a double-page spread on high-performance motorcycles under the headline "Bom to be wild".

The health pages were of course entirely devoted to risk stories: a new chickenpox vaccine whose effectiveness remains to be proven; a series of mistakes in cervical cancer screening that "put patients' lives at risk"; the risk of blood transfusions transmitting hepatitis-B; a vasectomy that did not work; concern that epidural anaesthetics administered during childbirth might harm the babies; the fear that bovine spongiform encephalopathy might have spread to humans in the form of Creutzfeld-Jakob disease; doubts about the efficacy of drugs prescribed to control high blood pressure; doubts about the accuracy of the diagnosis of high blood pressure, and claims that it is increased by the act of measuring it; claims that "the Government's present [health] screening programme cannot be justified by the results"; a lottery held to choose who would be given a scarce new and unproven drug for treating multiple sclerosis; and a member of parliament who died while waiting for a heart transplant, with credit for the shortage of donors being given to the seat belt law. Even the gardening pages were dominated by problems of decision-making in the face of uncertainty: combinations of soil, climate, aspect, fungicides and insecticides might be propitious for this plant and not for that.

The news pages were overwhelmingly devoted to risk. Risk it would appear is a defining characteristic of "news". On 28 January 1994 an aid worker had been killed in Bosnia; the us President's wife, Hilary Clinton, visited the aftermath of the Los Angeles earthquake, most of whose victims were reported to be uninsured; an Englishman staked his life savings of £150,000 on one spin of the roulette wheel in Las Vegas, and won; the death of a budgerigar was blamed on passive smoking, and a woman was turned down as a prospective adoptive parent because she smoked; the roof of a supermarket in Nice collapsed killing three people (56 column-inches), and a fire in a mine in India killed 55 people (nine column-inches); Prince Charles was fired at in Australia by a man with a starting pistol, and Princess Diana's lack of security was highly publicized, and lamented; further restraints were threatened on cigarette advertising; death threats were made by Moslem fundamentalists to a couturier and a fashion model following publicity about a ball gown embroidered with a passage from the Koran; the Government launched its "green" plan, and environmentalists complained about its in-adequacy. A few more headlines: "Rogue train ignored signals", "Russia's high-risk roulette", "Mountaineer cleared of blame for woman's death fall", "£440,000 losers in a game of Russian roulette (the costs of a lost libel action)", "Libel law proves costly lottery", "Fall in family fortunes", "The cat with 11 lives", "Gales strand trains and cause road havoc", "Firebombs in Oxford St raise fear of fresh IRA campaign", "Israelis have 200 N-bombs" and "Diet-conscious add years to life expectancy".

Television news and documentary programmes on the same day provided a further generous helping of things to worry about, and films added fictional accounts of neurosis, angst, murder and mayhem. Daily we are confronted with a fresh deluge of evidence that in this world nothing can be said to be certain, except death - stories of large-scale tax evasion having removed taxes from the short list of certainties. How do we cope?

Grown-up risk-taking, like that of children, is a balancing act. Whether it be the driver at the wheel of a car negotiating a bend in an icy road, or a shopper trying to decide whether to buy butter or the low-fat spread, or a doctor trying to decide whether to prescribe a medicine with unpleasant side-effects, or a property speculator contemplating a sale or a purchase, or a general committing his troops to battle, or a President committing his country to curbing the emission of carbon dioxide, the decisions that are made in the face of uncertainty involve weighing the potential rewards of an act against its potential adverse consequences.

Every day around the world, billions of such decisions get made. The consequences in most cases appear to be highly localized, but perhaps they are not. Chaos theorists have introduced us to a new form of insect life called the Beijing butterfly - which flaps its wings in Beijing and sets in motion a train of events that culminates two weeks later in a hurricane in New York. Extreme sensitivity to subtle differences in initial conditions, the chaos theorists tell us, makes the behaviour of complex natural systems inherently unpredictable. Prediction becomes even more difficult when people are introduced to such systems - because people respond to predictions, thereby altering the predicted outcome. Rarely are risk decisions made with information that can be reduced to quantifiable probabilities; yet decisions, some-how, get made.

The universality of expertise in risk management is a problem for those who aspire to recognition as risk EXPERTS. The certified experts - those who write books, learned articles and official reports on risk - have an abstracted expertise that is sometimes useful, but is more often misleading. They can demonstrate that the general public's ability to estimate mortality rates for different causes of death is often very wide of the mark (Fischhoff et al. 1981); they can demonstrate, in the words of the Royal Society quoted in Chapter 2, that there is a "gap between what is scientific and capable of being measured, and the way in which public opinion gauges risks and makes decisions". They can demonstrate that ordinary people in managing the risks in their lives, rarely resort to precise quantification. But what do their scientific measurements signify? Very little, this book suggests.

Risk management is big business; the formal sector of the authorities - the realm of the expert - involves government, commerce, and industry; it employs actuaries, ambulance drivers, toxicologists, engineers, policemen, mathematicians, statisticians, economists, chaos theorists, computer programmers and driving instructors - to name but a few. The work of this sector is highly visible. It holds inquests and commissions research. It passes laws and formulates regulations. It runs safety training programmes and posts warning signs. It puts up fences and locks gates. It employs inspectors and enforcers - many in uniform. Its objective is to reduce risk.

But there is also the informal sector consisting of children and grown-up children, and it is much bigger business; it consists of billions of freelance risk managers - ordinary common-or-garden experts - each with his or her own personal agenda. They go about the business of life - eating, drinking, loving, hating, walking, driving, saving, investing, working, socializing striving for health, wealth and happiness in a world they know to be uncertain. The objective of these risk managers is to balance risks and rewards.

The formal and informal sectors co-exist uncomfortably. For the freelance risk managers, the activities of the formal sector form a part of the context within which they take their decisions. Sometimes the efforts of the formal sector are appreciated: when, for example, it assumes responsibility for the safety of the water you drink. Sometimes its efforts are thought to be inadequate: when it fails to slow down the traffic on your busy street. Sometimes its efforts are resented: when it sets speed limits too low, or its safety regulations interfere with activities you consider safe enough. But in all of these cases, behaviour in the informal sector is modified by the activities of the formal sector. You do not boil your water if they have made it safe. You take more care crossing the road that their negligence makes dangerous. You watch out for the police or safety inspectors whose silly rules you are breaking.

The formal sector responds to the activities of freelance risk-managers in various ways. Often it is patronizing. Road engineers with their accident statistics frequently dismiss condescendingly the fears of people living alongside busy roads with good accident records, heedless of the likelihood that the good accident records reflect the careful behaviour of people who believe their roads to be dangerous. Those who live alongside such roads, and know their dangers, are more likely than the engineer, beguiled by his statistics, to cross them safely. Sometimes the formal sector's response is abusive: the people who flout their rules are stupid, irresponsible or childish. But most commonly the formal sector is mystified and frustrated. How, they wonder despite all their road improvements, vehicle safety regulations, speed limits, alcohol limits, warning notices, inspection procedures and fail-safe devices - do so many people still manage to have accidents?

A significant part of the explanation appears to lie in the formal sector's division of labour. Risk-management at an individual level involves no division of labour; the balancing calculations that precede a risky act are all done in the head of the individual. But when institutions assume responsibility for risk management, it becomes difficult to identify where the balancing act is done. Consider road safety. One can list institutions concerned with maximizing the rewards of risk taking: the car industry, the oil industry, the road builders, that part of the Department of Transport which sees its function as aiding and abetting the process that generates increasing traffic, the Treasury and Department of Trade and Industry who point to this increase as evidence of growing prosperity. One can list other institutions concerned with minimizing the accident costs of road traffic: the police, the casualty services, pacts (the Parliamentary Advisory Committee on Traffic Safety), rospa (the Royal Society for the Prevention of Accidents), Friends of the Earth and Greenpeace, who are concerned about the global threats of traffic pollution as well as the danger to cyclists and pedestrians, and that part of the Department of Transport responsible for road safety. But where, and how, is the balancing act done? How do institutional risk-managers manage individual risk-managers? And how do individual risk-managers react to attempts to manage them? And can we all do it better?

The search for answers begins, in Chapter 2, with a look at the prevailing orthodoxy, as exemplified by the Royal Society's approach to risk management.

1. The Times, the Guardian, the Sun, the Daily Express, the Daily Mail, and the London Evening Standard.

Chapter 2
Risk and the Royal Society

In 1983 Britain's Royal Society published a report called Risk assessment. Its tone, in keeping with the Royal Society's standing as the country's preeminent scientific institution, was authoritative, confident and purposeful. The report drew upon and exemplified the prevailing international orthodoxy on the subject of risk, and became a major work of reference. In 1992 the Society returned to the subject with a new report entitled Risk: analysis, perception and management. Although it was published by the Royal Society, the Society was sufficiently embarrassed by its contents to insist in the preface that it was "not a report of the Society", that "the views expressed are those of the authors alone" and that it was merely "a contribution to the ongoing debate". By 1992 the Royal Society was no longer capable of taking a collective view about risk; it had become a mere forum for debate about the subject. What happened? What is this "ongoing debate", and how did it derail their inquiries into the subject?

For their 1992 report the Society invited a group of social scientists psychologists, anthropologists, sociologists, economists and geographers to participate in their study. The social scientists, with the exception of the economists, could not agree with the physical scientists of the Royal Society. The disagreement that is found between the covers of the 1992 report can be found wherever there are disputes about safety and danger. It is a disagreement about the nature and meaning of "risk". The resolution of this disagreement will have profound implications for the control and distribution of risk in all our lives.

"Actual risk": what is it?

The 1983 report distinguished between objective risk - the sort of thing "the experts" know about - and perceived risk - the lay person's often very different anticipation of future events. Not surprisingly, given the report's

provenance, it approached its subject scientifically. This is how it defined the subject of its study in 1983:

The Study Group views "risk" as the probability that a particular adverse event occurs during a stated period of time, or results from a particular challenge. As a probability in the sense of statistical theory, risk obeys all the formal laws of combining probabilities.

The Study Group also defined detriment as:

a numerical measure of the expected harm or loss associated with an adverse event... it is generally the integrated product of risk and harm and is often expressed in terms such as costs in £s, loss in expected years of life or loss of productivity, and is needed for numerical exercises such as cost-benefit analysis or risk-benefit analysis.

The Royal Society's definition of "detriment", as a compound measure combining the probability and magnitude of an adverse effect, is the definition of "risk" most commonly encountered in the risk and safety literature (see for example Lowrance 1980). It is also the definition of common parlance; people do talk of the "risk" (probabi...