Perceived ambiguity about earthquake and house destruction risks

To create effective risk mitigation policies and improve risk communications, it is important to understand how individuals perceive ambiguity about certain risks. A significant number of studies have demonstrated that an individual’s behavior is sensitive to ambiguity. Therefore, this study explores how Japanese homeowners perceive ambiguity about earthquake and house destruction risks by focusing on two research questions: (1) To what degree do people perceive ambiguity? and (2) What are the factors that affect the degree of perceived ambiguity? We administered a survey to 1200 homeowners in Japan. Respondents were asked to state their subjective probabilities and ambiguities about earthquake and house destruction risks. Next, we examined the socioeconomic characteristics affecting their perceived ambiguities by applying a sample selection model. The findings reveal four aspects related to ambiguity. First, some homeowners perceived considerable ambiguity, while the majority observed small degrees of it. Second, on average, homeowners perceived less ambiguity about house destruction risk compared to earthquake risk. Third, socioeconomic characteristics and house attributes had an effect on the perception of ambiguity. Finally, from the perspective of creating policies that mitigate house destruction risks due to earthquakes, seismic diagnoses can help correct subjective risks and reduce the perceived ambiguity regarding them.