Zero-risk bias

Zero-risk bias occurs when individuals value complete elimination of a risk, however small, to a reduction in a greater risk which is a greater reduction but which does not eliminate that risk entirely. Individuals may prefer small benefits that are "certain" to large ones that are "uncertain".

An example is the Delaney clause of the Food and Drug Act of 1958, which stipulated a total ban on synthetic carcinogenic food additives. The "total ban" was a zero-risk policy that actually led to health risks due to exposure to older, probably more dangerous food additives that continued to be used. Also, it gave companies incentive to create non-carcinogenic additives that were potentially more harmful.

Zero-risk bias occurs because individuals worry about risk, and eliminating it entirely means that there is no chance of harm being caused. What is economically efficient and possibly more relevant, however, is not bringing risk from 1% to 0%, but from 50% to 5% (for example).

It is related to the concept of cognitive closure (psychology), and it can also be explained in terms of a tendency to think in terms of proportions rather than differences. When a risk is reduced to zero, 100% of the risk is removed.