Ambiguity aversion and familiarity bias: Evidence from behavioral and gene association studies

Soo Hong Chew, Richard P. Ebstein, Songfa Zhong

Research output: Contribution to journalArticlepeer-review


It is increasingly recognized that decision making under uncertainty depends not only on probabilities, but also on psychological factors such as ambiguity and familiarity. Using 325 Beijing subjects, we conduct a neurogenetic study of ambiguity aversion and familiarity bias in an incentivized laboratory setting. For ambiguity aversion, 49.4% of the subjects choose to bet on the 50-50 deck despite the unknown deck paying 20% more. For familiarity bias, 39.6% choose the bet on Beijing's temperature rather than the corresponding bet with Tokyo even though the latter pays 20% more. We genotype subjects for anxiety-related candidate genes and find a serotonin transporter polymorphism being associated with familiarity bias, but not ambiguity aversion, while the dopamine D5 receptor gene and estrogen receptor beta gene are associated with ambiguity aversion only among female subjects. Our findings contribute to understanding of decision making under uncertainty beyond revealed preference.

Original languageEnglish (US)
Pages (from-to)1-18
Number of pages18
JournalJournal of Risk and Uncertainty
Issue number1
StatePublished - Feb 2012


  • Ambiguity aversion
  • Familiarity bias
  • Genetics
  • Neuroeconomics
  • Source dependence

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics


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