3.3.1.1 Risk
Both SET and PMT identify risk as an important component. As SET indicates, costs and rewards are an integral part of any exchange. In PMT, risk is a component of the threat appraisal which impacts the type of coping that will be initiated. Although risk is not obviously denoted in the original PMT model, severity and vulnerability are in fact the two components that make up risk (Mitchell 1999).
Risk simply put, is the probability and magnitude of loss or gain (Douglas 1992). Risk is sometimes treated as objective or subjective (Mitchell 1999), but for this research it will be treated as a subjective measure, as such it is inherently socially constructed. It is a concept people use to “help them understand and cope with dangers and uncertainties of life.” (Slovic 1999; p 690). When individuals are confronted with situations that have uncertain consequences that may cause discomfort, they will evaluate the likelihood of these consequences, their own personal acceptable level of risk, and the significance of the risk or benefit, and only then will they take an appropriate action (Dowling and Staelin 1994, Youn 2005, Cho 2004).
Perceived risk has been studied in many different areas including psychology, sociology, and marketing. Research has agreed that there are many components of risk including: inherent risk, handled risk, accepted risk, and product specific risk (Bettman 1973, Dowling and Staelin 2003). In general, most definitions of risk agree that there are two main components: uncertainty and