Risk and Reward

Life is full of risks.  A risk, by definition, is an exposure to danger, harm or loss.  There are financial risks, transportation and travel risks, adventure risks, health risks and many others.  When one speaks of a risk, there must be uncertainty in an outcome of some event or behavior.  There must be some probability that a bad outcome could occur.  The level of risk is based on how high the probability is of that bad outcome.

A risk is typically undertaken because there is some expected reward associated with the event or behavior if things go well.  The reward may have significant monetary, psychological or experiential advantages, or it may simply be the completion of an ordinary but necessary task in one’s life.

 

Some people are described as risk-takers.  They are not afraid of taking ‘chances’ with their money or their health or even their lives.  Others are described as risk-averse.  It is interesting to contemplate what these descriptions really mean and what is the thought process involved in taking or avoiding risk.  

 

When I drive a car each day, I am taking a risk.  If I ride a bicycle on a street with cars, I am taking a risk.  If I clean the gutters on my roof, I am taking a risk. Do we internally calculate or otherwise estimate the probability of being hurt in these activities? 

 

Is driving a car an acceptable risk because it has a low probability of producing an accident with injuries, or is it simply something we do without thinking about the risk?  If I were to be paralyzed in a car accident, would driving all those years have been an acceptable risk?  I cannot imagine anyone blithely conceding that point.  Something is an acceptable risk only before a bad outcome occurs.  In most cases we use the term acceptable risk to describe a risk that is low enough to feel reasonably secure that the bad outcome will never happen.

 

Mountain climbers or hang-gliders who consider their death-defying acts as acceptable risks are also making the assumption that they will not die.  They love the activity of mountain climbing enough to take the risk, but it is doubtful they would say in retrospect that the risk was worth it if they are horribly maimed in an accident.  It seems the risk was only acceptable when nothing bad happened.

 

Men gleefully enlist and march off to war for the reward of unique experiences and perhaps a chance for exhibiting their courage.  But if they lose a leg or two, I highly doubt they will say that the risk was an acceptable one or that the experience or possibility of an award for valor was worth the lifetime of suffering they will now endure.

 

Financial investments and employment changes are also interesting versions of risk-taking.    The many well-publicized rags-to-riches stories make financial risk-taking seem very exotic and exciting.  But one wonders how many financial failures and hard-luck tales there are for every successful entrepreneur or investor.  Did the failures consider their doomed exploits to have been a ‘reasonable risk’?

 

Risk-taking may also be somewhat age dependent.  I know I was much more of a risk-taker in terms of physical challenges in earlier years.  And I capriciously experimented with drugs in my teens and early twenties in a way that I would never do today.  As age progresses our awareness of the consequences of our actions is better informed and applies the brakes to certain types of risky activity.

 

For the most part I doubt there is a way to quantify or even comprehend risk when one embarks on a new venture of any type.  There may be a gut feeling or an instinctual sense that the activity is worth doing.  The risk-takers are those who seem to have either no fear of failure and retain that feeling of youthful immortality, or are so driven by the need for change, recognition or wealth that they are compelled to choose the path of higher risk. The risk-averse are either more peacefully content with their lot or more sensitively aware of the potential for true damage, harm or loss.

 

There are extremes on both ends of the risk scale.  Wingsuit base jumping and free soloing would certainly seem to be examples of risk-taking that border on suicidal behavior.  And there are lots of people who timidly avoid any risk and thus severely limit their life experiences.

 

In the end, it seems that risk-taking is primarily a personality trait that has little analysis behind it.  It is difficult to say what kind of effect one’s willingness to take risks has on quality of life or one’s sense of fulfillment.  We are all unique creatures and must find the balance of risk and reward that makes sense for us and not feel compelled to emulate others.