Did the Three Pigs have different Risk Tolerances?

Or did they just have a different view of the degree of risk in their environment?

3 PigsBy Alex Proimos from Sydney, Australia – Three Little Pigs

Think about it?  Is there any evidence that the first pig, whose house was made off straw, was fine with the idea of losing his house?  Not really.  More likely, he thought that the world was totally benign.  He thought that there was no way that his straw house wouldn’t be there tomorrow and the next day.  He was not tolerant of the risk of losing his house.  He just didn’t think it would happen.  But he was wrong.  It could and did happen.

The second pig used sticks instead of straw.  Did that mean that the second pig had less tolerance for risk than the first pig?  Probably not.  The second pig probably thought that a house of sticks was sturdy enough to withstand whatever the world would send against it.  This pig thought that the world was more dangerous than the first pig.  He needed sticks, rather than straw to make the house sturdy enough to last.  He also was wrong.  Sticks were not enough either.

That third pig has a house of bricks.  That probably cost much more than sticks or straw and took longer to build as well.  The third pig thought that the world was pretty dangerous for houses.  And he was right.  Bricks were sturdy enough to survive.  At least on the day that the wolf came by.

The problem here was not risk tolerance, but inappropriate parameters for the risk models of the first two pigs.  When they parameterized their models, the first pig probably put down zero for the number of wolves in the area.  After all, the first pig had never ever seen a wolf.  The second pig, may have put down 1 wolf, but when he went to enter the parameter for how hard could the wolf blow, he put down “not very hard”.  He had not seen a wolf either.  But he had heard of wolves.  He didn’t know about the wind speed of a full on wolf huff and puff.  His model told him that sticks could withstand whatever a wolf could do to his house.  When the third pig built his risk model, he answered that there were “many” wolves around.  And when he filled in the parameter for how hard the wolf could blow, he put “very”.  When he was a wee tiny pig, he had seen a wolf blow down a house built of sticks that had a straw roof.  He was afraid of wolves for a reason.

 

 

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