Unawareness and Risk Taking: The Role of Context

A . We study the e ects of exposure to unawareness on risk taking using a novel experimental task, which has solutions that are di cult to find, but easy to verify and so exposes subjects to unawareness in a natural way. We find that exposure to unawareness alone does not a ect risk taking. The role of context, however, is shown to be important. For the treatments inducing unawareness, subjects are more risk averse when the investment decision is framed in the same context as the complex task versus framed in a neutral way; we observe no such di erences for the control treatment.