Section1 Literature Review
1.1 Language effect
With globalization, multilingual skill has become a language advantage in many industries. Millions of people are using more than one language on a daily basis to communicate and to work. In general, first language appears to be more proficient than second language. Given that first language is developed throughout an individual’s daily life, while the second language is often required in a classroom setting.
Despite the bilingual individuals who master two language at a native user level, most of people are differentiated in behaviour and thinking process under their first and second language environment. Many studies have been done that showed the use of a foreign language affects judgment …show more content…
The Ellsberg paradox is a paradox in decision theory in which people's choices violate the postulates of subjective expected utility. It is generally taken to be evidence for ambiguity aversion.
Ellsberg actually proposed an experiment of coloured balls in urns. Subjects are asked to draw a coloured ball in one of the two urns. Each urn contains balls of two colours, either yellow or black. One of urn is considers as a Risky Urn, in which the probability of the coloured ball is listed. The other urn is considered as the Ambiguous Urn, in which the proportion of the coloured balls are unknown. This experiment proposed choices which contradict subjective expected utility.
It turned out that people overwhelmingly preferred taking the Risky Urn rather than the Ambiguous Urn. When exact chances of winning is known, people would rather risk a lower probability in winning, than go for the completely ambiguous option. Despite the fact that the Ambiguous Urn might be able to guarantee a winning when the Risky Urn holds a very low probability in winning. That is, given a choice of risks to take people "prefer the devil they know" rather than assuming a risk where odds are difficult or impossible to …show more content…
Hayakawa, and Sun Gyu An conducted six experiments to test language effect on decision making. They employed university student whose mother tongue is English, and second language Japanese in the first four experiment regarding risk attitude. They applied the Asian Disease case as the statement:
Recently, a dangerous new disease has been going around. Without medicine, 600,000 people will die from it. In order to save these people, two types of medicine are being made. If you choose Medicine A, 200,000 people will be saved.
If you choose Medicine B, there is a 33.3% chance that 600,000 people will be saved and a 66.6% chance that no one will be saved.
Which medicine do you choose?
77% of the participants who answered this gain-framed question chose Medicine A. And when the statement is made in Japanese, their second language, only 47% did.
Their result strongly support the theory of Increased-Systematicity under a second language environment. They have demonstrated that the use of a foreign language dramatically reduces the gain-loss asymmetry in risk preferences, resulting in a frame-independent choice, which is more in line with standard economic
1.1 Language effect
With globalization, multilingual skill has become a language advantage in many industries. Millions of people are using more than one language on a daily basis to communicate and to work. In general, first language appears to be more proficient than second language. Given that first language is developed throughout an individual’s daily life, while the second language is often required in a classroom setting.
Despite the bilingual individuals who master two language at a native user level, most of people are differentiated in behaviour and thinking process under their first and second language environment. Many studies have been done that showed the use of a foreign language affects judgment …show more content…
The Ellsberg paradox is a paradox in decision theory in which people's choices violate the postulates of subjective expected utility. It is generally taken to be evidence for ambiguity aversion.
Ellsberg actually proposed an experiment of coloured balls in urns. Subjects are asked to draw a coloured ball in one of the two urns. Each urn contains balls of two colours, either yellow or black. One of urn is considers as a Risky Urn, in which the probability of the coloured ball is listed. The other urn is considered as the Ambiguous Urn, in which the proportion of the coloured balls are unknown. This experiment proposed choices which contradict subjective expected utility.
It turned out that people overwhelmingly preferred taking the Risky Urn rather than the Ambiguous Urn. When exact chances of winning is known, people would rather risk a lower probability in winning, than go for the completely ambiguous option. Despite the fact that the Ambiguous Urn might be able to guarantee a winning when the Risky Urn holds a very low probability in winning. That is, given a choice of risks to take people "prefer the devil they know" rather than assuming a risk where odds are difficult or impossible to …show more content…
Hayakawa, and Sun Gyu An conducted six experiments to test language effect on decision making. They employed university student whose mother tongue is English, and second language Japanese in the first four experiment regarding risk attitude. They applied the Asian Disease case as the statement:
Recently, a dangerous new disease has been going around. Without medicine, 600,000 people will die from it. In order to save these people, two types of medicine are being made. If you choose Medicine A, 200,000 people will be saved.
If you choose Medicine B, there is a 33.3% chance that 600,000 people will be saved and a 66.6% chance that no one will be saved.
Which medicine do you choose?
77% of the participants who answered this gain-framed question chose Medicine A. And when the statement is made in Japanese, their second language, only 47% did.
Their result strongly support the theory of Increased-Systematicity under a second language environment. They have demonstrated that the use of a foreign language dramatically reduces the gain-loss asymmetry in risk preferences, resulting in a frame-independent choice, which is more in line with standard economic