Choice Preferences in the Process of Making Regulatory Decisions under Risk and Uncertainty Conditions: An Experimental Study
Purpose: This paper aims to identify preferences in regulatory decision-making under conditions of risk and uncertainty. Design/Methodology/Approach: Research using the experimental method was conducted among top-management of the regulatory authority in Poland, Office of Electronic Communications (OEC) and telecommunications National Regulatory Authorities in UE -members of Body of European Regulators for Electronic Communications. Findings: The findings suggest the occurrence of a certainty effect, loss avoidance effect, reflection, ambiguity aversion effect, and the status quo effect, all of which are psychological determinants shaping the preferences of regulatory decision selection under conditions of risk and uncertainty. The preferences under conditions of risk and uncertainty vary depending on the decision-making situation. There is no clear link between declared and actual risk preferences expressed by the OEC top management in decision-making situations. Risk preferences top-management OEC and BEREC are converging. Practical Implications: There is a need to shape the architecture of choice for public decision-makers in a decision-making situation in conditions of risk and uncertainty that take into account their cognitive tendencies. Originality/Value: The findings presented in the article contribute to the discussion on regulators’ cognitive tendencies in determining regulatory decision preferences under conditions of risk and uncertainty. An experimental research approach can explain the cognitive tendencies of public decision-makers.