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2021/2022  KAN-CCMVV2428U  (Psychological) Strategies for Coping With Radical Uncertainty

English Title
(Psychological) Strategies for Coping With Radical Uncertainty

Course information

Language English
Course ECTS 7.5 ECTS
Type Elective
Level Full Degree Master
Duration One Quarter
Start time of the course Second Quarter
Timetable Course schedule will be posted at calendar.cbs.dk
Max. participants 80
Study board
Study Board for MSc in Economics and Business Administration
Course coordinator
  • Timo Ehrig - Department of Strategy and Innovation (SI)
Main academic disciplines
  • Entrepreneurship
  • Strategy
  • Business psychology
Teaching methods
  • Blended learning
Last updated on 15-02-2021

Relevant links

Learning objectives
After the course it is expected that students can:
  • describe and explain a set of core theoretical insights from cutting edge psychological research on how humans can to cope with radical uncertainty
  • apply such coping strategies (in particular, heuristics) successfully in a given context, in particular, decision-making in the post-Covid economy (in entrepreneurial and corporate settings)
Course prerequisites
Prerequisites for registering for the exam (activities during the teaching period)
Number of compulsory activities which must be approved (see section 13 of the Programme Regulations): 1
Compulsory home assignments
The student must get approval for 1 out of 2 assignments in order to attend the ordinary exam. The compulsory assignments are:

Both assignments are written in a group but is evaluated individually. The group members must prepare a statement that outlines each individual's contribution to the assignment. The assignment is evaluated internally on a pass/fail basis. The purpose of the assignments is to provide students feedback concerning their ability to use the competencies gained in the course.

The student will not have extra attempts to get the required number of compulsory activities approved prior to the ordinary exam. If the student has not received approval for the required number of compulsory activities or has been ill, the student cannot participate in ordinary exam. Prior to the retake the student will be given an extra attempt..The extra attempt is a 10 page home assignment that will cover the required number of compulsory activities. If approved, the student will be able to attend retake. Please note that students must have made an effort in the allocated assignments thoughout the course. Students that do not participate in the assignments (no show/U) are not entitled to the extra assignment and will have to wait until the next ordinary exam to complete the course.
(Psychological) Strategies for Coping With Radical Uncertainty:
Exam ECTS 7,5
Examination form Home assignment - written product
Individual or group exam Individual exam
Size of written product Max. 15 pages
Assignment type Scientific paper
Duration 2 weeks to prepare
Grading scale 7-point grading scale
Examiner(s) One internal examiner
Exam period Winter
Make-up exam/re-exam
Same examination form as the ordinary exam
The assignment for the re-exam is the same as for the initial exam. If the student fails the ordinary exam the course coordinator chooses whether the student will have to hand in a revised product for the re- take or a new project.
Course content, structure and pedagogical approach

The popularity of books such as “The Black Swan” by Nassim Taleb or “Gut Feelings” by Gerd Gigerenzer indicates the demand for awareness of (psychological) mechanisms to cope with uncertainty and insights into how we can improve them.

Radical uncertainty is different from uncertainty (and complexity in decision-making) per se, as contingencies are often unknowable and robust courses of actions (or even "antifragile" outcomes that benefit from surprises) are preferable to courses of action that appear rational today, but that may be rendered obsolete tomorrow.

This is particularly relevant in 2021! After the Covid lockdowns will (hopefully) be over, radical uncertainties will emerge from and in the post-Covid economy. It is yet unclear how the job market will recover after the lockdowns; which companies will survive, or die, or newly emerge; and how the governments will write down their Covid debts (and what this implies for financial markets and inflation).
Uncertainties in such situations extend beyond “risk” (in the sense of Knight): We cannot know the associated contingencies and even for those that we know, we cannot know probabilities. Rather, we have to cope with radical uncertainty. Thus, we face a situation not described by most research in behavioral economics, which predominantly assumes that contingencies and associated probabilities are knowable.

The unique contribution of this elective is to offer rigorous insights from cutting-edge psychological research (Gigerenzer, Taleb, Tuckett) into successful strategies for coping with radical uncertainty, combined with case-based learning to make the insights vivid.
From a theoretical perspective, this course offers insights into the state-of-the-art of research into the psychology of radical uncertainty. We will cover insights about adaptive rationality (the Gigerenzer research program; how people successfully use heuristics when samples are small, distributions are unknown) and strategic uncertainty (how we cope with uncertainty about how others may react to the post-crisis situation).

These theoretical insights are of particular relevance in entrepreneurial and firm-internal innovation settings. For instance, how can strategists (like CBS graduates in 2022 who start to work in corporate settings) quickly assess whether a particular business model that was not feasible in the Covid lockdown phase (say, an interactive theater) will prosper again, or whether it will not survive in the post-Covid economy? Such assessments will necessarily be based on very little data (they have to be made rather quickly, based on just a few observations in the post-Covid world), and we need to avoid generalization mistakes in this context.

The above-mentioned theories offer the backbone for a study of concrete cases (some of which will be “real-time” cases, of which the outcome is not known at the time of the elective). Thus, the course contains a significant experiential element where students can learn via cases that may affect their actual decision making in 2021 and 2022. These hands-on experiences will then be reflected through academic literature and in-class case discussion. The final exam combines these theoretical and case elements.
 The course will emphasize open discussions and will use a mixture of theory and case studies to engage students in the classroom. To have an optimal mix between theory and practice, 11 lectures of each 2 hours will be accompanied by 9 case presentation sessions of 1 hour each. Topics and readings for each session are published as course outline via Canvas.

Description of the teaching methods
The eleven lectures are to a large extent literature-based and will also incorporate short cases to discuss some of the challenges of decision-making under radical uncertainty. We intend to engage in a dialogue-based teaching approach. Thus, to gain the most benefit from class sessions students should be prepared to take an active part in class discussions and to prepare the readings thoroughly.

We boost the interactive components of the course by incorporating case presentations of students. Students will form groups to present cases that are assigned in the first two lectures. Each student will be responsible for one slide in a case presentation. This slide is the mandatory assignment that must be passed to get admission to the final exam.
Feedback during the teaching period
The design of the course follows a proactive feedback philosophy by ex-ante mirroring the exam. Students are repeatedly exposed to learning objectives and exam sub-tasks. In particular, students will receive detailed feedback after their case presentation (the mandatory assignment). Moreover, we will discuss writing samples of the students in class to give students a clear idea on how their final exams will be graded.

In related preparation sessions, students can ask for detailed feedback on their performance. Hence, they have opportunities for feedback all along the course, and well before they enter the actual exam. Parts of the final lecture are used to recap material, provide overarching feedback, and invite detailed student questions.
Student workload
Classroom 30 hours
Classroom preparation (readings, cases) 76 hours
Case Research and Presentation 50 hours
Exam 50 hours
Expected literature

Bettis, R. A. (2017). Organizationally intractable decision problems and the intellectual virtues of heuristics. Journal of Management, 43(8), 2620-2637.


Ehrig, T. & Schmidt, J. (2019) Making biased but better predictions: The trade-offs strategists face when they learn and use heuristics. Strategic Organization,


Felin, T., & Zenger, T. R. (2009). Entrepreneurs as theorists: on the origins of collective beliefs and novel strategies. Strategic Entrepreneurship Journal, 3(2), 127-146.


Gigerenzer, G., & Brighton, H. (2009). Homo heuristicus: Why biased minds make better inferences. Topics in cognitive science1(1), 107-143.


Nagel, R. (1995). Unraveling in guessing games: An experimental study. The American Economic Review85(5), 1313-1326.


Taleb, N. N. (2012). Antifragile: Things that gain from disorder (Vol. 3). Random House Incorporated.

Last updated on 15-02-2021