Optimal risky choice in humans: effects of amount of variability

The present study investigated whether the predictions of an optimal risk-sensitive foraging model (the energy-budget rule) would extend to humans’ choices between high- and low-variance monetary response options. In Experiment 1, participants were presented with repeated choices between two options that had the same mean values but different variances across positive- and negative-budget conditions. In Experiment 2, a within-subject comparison was conducted to investigate choice under positive- and negative-budget conditions when the options were either (a) a fixed option and a high-variance option, or (b) a low-variance option and a high-variance option. Session-wide choices were analyzed in relation to the predictions of the energy-budget rule and sequential choices were analyzed with dynamic optimization modeling. When both options were variable choice was generally consistent with predictions of the energy-budget rule and was more risk prone under negative-budget than positive-budget conditions. Sequential choices were sensitive to local budget conditions, but choices were less consistent with optimality when both options were variable, possibly because of the greater similarity in expected earnings for optimal and nonoptimal choices in these conditions. Overall, the results provide further evidence that the energy-budget rule may have broad applicability and that it can extend to human risky choice between multiple variable response options.