ABSTRACT
Economic choices are almost always made with some uncertainty as to what the outcome will be. A person buys groceries without knowing for sure how tasty they will be. He buys a new car without knowing how it will perform or how long it will last, a plane ticket without knowing whether the plane will be delayed, house insurance because he does not know whether his house will be burgled, and invests in shares without knowing whether they will increase or decrease in value. In the last chapter we saw that uncertainty can lead to choice arbitrariness and all the consequences that entails. What I want to do in this chapter is look in more detail at some other important consequences of risk.
