Why Prosocial Decision Making Is Transformed By Risk: Prospect Theory, Self-Image, and Risky Choices

In classic judgment and decision-making research, a fundamental distinction was made between riskless choices and risky choices. Surprisingly, this distinction has largely been neglected in prosocial decision-making research, which has focused on examining riskless prosocial choices (e.g., tipping, dictator game giving) while implicitly assuming findings will generalize to risky prosocial choices (e.g., volunteering to try to help someone, while knowing that one’s attempt to help might fail). We challenge this assumption. We assert that risk transforms prosocial decision-making: Specifically, we argue that self-image concern influences both risky choices and prosocial choices in different ways, which interact to produce a unique combined impact on risky prosocial choices. Consistent with our theory, incentivized experiments (Experiments 1-2) show that risk reduces prosocial choices less than proself choices (if outcomes are viewed as gains), and that this interaction effect is mediated by self-image concern. Further consistent with our theory, an 18-round incentivized experiment (Experiment 3) shows that describing prosocial outcomes using loss (versus gain) frames boosts risky prosocial choices more than riskless prosocial choices. This result was driven by the fact that, for risky prosocial choices, using loss (versus gain) frames acted as a powerful nudge that boosted prosocial choices by 40%–an impact nearly ten times larger than leading prosocial-choice nudges, with significant practical implications for policymakers and leaders who wish to encourage prosocial choices. Our findings suggest that risk transforms prosocial decision making, and our results point to fundamental differences in the decision processes underlying riskless prosocial choices versus risky prosocial choices.