The Ambiguity Effect describes the tendency people have to avoid options with unknown results, or about which they lack information. Decision-making is affected by lack of information and ambiguity: people tend to select options for which the outcome is more certain – even if it isn’t necessarily the most advantageous outcome – because they prefer surer things.

In other words, people avoid doing things or making choices they know less about. This results in a reluctance to try new things and a limited ability to recognise long-term benefits of riskier decisions compared to marginal gains from safer choices.

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