Cognitive, developmental, and neurobiological aspects of risk judgments

In this chapter, we explore the literature on the cognitive, developmental, and neurobiological aspects of risk and show how work in this area is important in explaining and understanding decisions relating to risk. We outline different theories of risk preference and risk taking, including prospect theory, traditional dual-process theories, fuzzy-trace theory, and construal level theory. We focus on how cognitive differences can account for differences in risk preference and risk taking and examine how cognitive developmental trends can explain the observation that adolescents (and young adults) are prone to unhealthy risk taking. We outline important work in this area showing that the way information is mentally represented influences decisions relating to risk, in addition to more traditional factors such as reward sensitivity and inhibition. We explain how accounting for the role of mental representation can explain and predict counterintuitive findings in the literature on risk taking. In addition, we consider the neural underpinnings of risk taking and what research into the neural underpinnings of risk taking can tell us about cognitive aspects of risk.