Personality-led Theory of Risk taking Understanding decision makers’ risk dispositions has important implications for the fundamental question of international relations: why does war happen? A leader’s risk propensity is key to his or her resolve, or willingness to go to and carry out a war.2 Although scholars have long recognized that “an actor’s orientation toward risk is a 1 Following in the tradition of microeconomics and scholarship in political science, risk-taking is defined as the leader choosing a high variance strategy based on the set of alternatives presented to her or him when making a foreign policy decision. Higher variance strategies have more numerous and divergent outcomes; they have a higher potential for both gain and loss, compared to an option with a more constrained probability outcome (XxXxxxxxx [1998] 2004, 11). 2 Xxxxxx (1989, 942) proposes that a greater willingness to take risks is one of three sources of greater resolve. The other two are greater military capabilities and an objectively less favorable status quo. psychological trait best evaluated through an in-depth examination of the decision maker’s personality and environment” (Bueno xx Xxxxxxxx 1981, 123), few have attempted to systematically analyze the psychological dimensions of elites’ risk orientations. The leading explanation of risk-taking in international relations, prospect theory, examines the effect of circumstances on decision makers’ cognitive processes. According to prospect theory, “people tend to evaluate choices with respect to a reference point, overweight losses relative to comparable gains, engage in risk-averse behavior in choices among gains but risk-acceptant behavior in choices among losses, and respond to probabilities in a nonlinear manner” (Levy 1997, 87). Who the decision maker is, matters very little because the predicted behavior is based on how a situation is framed. While the robustness of prospect theory has been substantiated through experiments over the past several decades, it has also been found that roughly one-third of subjects do not exhibit the predicted effects (Kowert and Hermann 1997; Levy 1992, 2003a; Xxxxxx 2005a). The past decade has witnessed a flurry of research across the disciplines of business, psychology, and political science on the heterogeneity of individuals’ risk preferences. While they may ask different questions, underlying all these studies is essentially the same issue; namely, whether individuals have inherent risk propensities that incline...
Personality-led Theory of Risk. Taking In his seminal book, The War Trap, Bueno xx Xxxxxxxx states: The measurement of risk taking in international politics, however, is virtually unchartered territory…virtually no one has tried to measure the risk-taking orientation of foreign policy decision makers for more than a handful of usually experimental situations. An actor’s orientation toward risk is a psychological trait best evaluated through an in-depth examination of the decision maker’s personality and environment. Such an analysis, unfortunately, is impossible here. (1981, 122-3) Nearly three decades later, this assessment still stands. Although scholars of international relations recognize that leaders’ risk propensities play a critical role in predicting the types of policies their states engage in, it is difficult to falsify this claim without an objective measure of personality. Leaders’ traits are most often understood as idiosyncratic and are dismissed as being part of the error term of any systematic analysis. This dissertation challenges this view by presenting the first cut at a theory of risk-taking that accounts for the variance in leaders’ inherent risk propensities based on their personality traits.
