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Abstract

Attitudes towards risk play a crucial role in everyday decision-making as well as in psychiatric disorders like anxiety. The Balloon Analogue Risk Task (BART) pro- vides a behavioral measure of risk preference that has been widely applied to both clinical and nonclinical pop- ulations. However, although most versions of BART in- volve epistemic as well as aleatoric uncertainty, the impli- cations of this for risk-sensitivity have not been explored. We adopt a prominent theoretical framework for under- standing risk, namely conditional value-at-risk (CVaR), to elucidate the effect of risk attitudes on optimal explo- ration and exploitation in a simple instance of BART. In sequential problems, CVaR comes in two different flavors: pCVaR, which precommits to a level of risk at the very first choice; and nCVaR, which re-applies the same risk level at every step in a nested manner. We show that the structure of stochasticity in the BART is such that pCVaR is more risk-averse than nCVaR in a single trial, for the same nominal risk. We also show that risk pref- erences and prior expectations interact in risk-sensitive exploration across multiple trials. We hope to provide a normative grounding for a more detailed understanding of behavioral variation in the BART.