Framing effect (psychology)

The framing effect, one of the cognitive biases, describes that presenting the same option in different formats can alter people’s decisions. Specifically, individuals have a tendency to select inconsistent choices, depending on whether the question is framed to concentrate on loses or gains (Plous, 1993).

An Example

In a set of experiments on framing performed by psychologists Tversky and Kahneman (1981), it was found that different phrasing impacted participants’ responses to a question about a disease prevention strategy. The first problem given to participants offered two alternative solutions for 600 people affected by a hypothetical deadly disease:

• treatment A saves 200 peoples’ lives
• treatment B has a 33% chance of saving all 600 people and a 66% possibility of saving no one.

Although these decisions are mathematically identical, 72% of participants chose option A, whereas only 38% of participants chose option B (Tversky & Kahneman, 1981). Another group of participants were given the same scenario with different statistics:

• option C in which 400 people die
• option D has a 33% chance that no people will die but a 66% probability that all 600 will die.

In this set of choices, participants preferred the treatment D to treatment C by 78% to 22% (Tversky & Kahneman, 1981). The discrepancy in choice between these parallel options is in essence the framing effect; the options chosen in the two examples are inconsistent, because the decision is expressed employing different language. In the first problem, a positive frame emphasizes lives gained, but in the second example a negative frame accentuates death. Options A and C represent the same principal; if only 200 people are saved from a deadly disease, 400 must die. Yet, A is preferred in problem 1, and C is opposed in problem 2. The alterations in the language underlie the differences in the preferences.

Causes

Framing impacts people, because individuals perceive losses and gains differently, as illustrated in prospect theory (Tversky & Kahneman, 1981). The value function, founded in prospect theory, illustrates an important underlying factor to the framing effect: a loss is more devastating than the equivalent gain is gratifying (Tversky & Kahneman, 1981). Thus, people tend to avoid risk when a positive frame is presented but seek risks if a negative frame is utilized (Tversky & Kahneman, 1981) . Additionally, the value function takes on a sigmoid shape, which indicates that gains for smaller values are psychologically larger than equivalent increases for larger quantities (Tversky & Kahneman, 1981). Another important factor contributing to framing is certainty and pseudocertainty effects in which a sure gain is favored to a probabilistic gain, but a probabilistic loss is preferred to a definite loss (Tversky & Kahneman, 1981). For example, in Tversky and Kahneman’s (1981) experiment, in the first problem, treatment A, which saved a sure 200 people, was favored due to the certainty effect.

Applications

The framing effect has not only been shown in the laboratory; it has much relevance to many real world situations. Certain types of payment options may also be able to employ the framing effect to encourage people to pay at an earlier date. For example, PhD students demonstrated susceptibility to framing when reminded to pay a mandatory registration fee (Gätcher Orzen, Renner, & Stamer, in press). Specifically, Gätcher et al. (in press) reported 93% of PhD students registered early when presented a loss frame, described as a penalty fee, as opposed to 67% students registering early when presented a positive frame in the form of a discount. Additionally, political options can be framed in a way that promotes voters to prefer a certain alternative. For instance, people prefer an economic agenda when high employment rates are provided, but they are against it when the complementary unemployment rates are accentuated (Druckman, 2001b). Additionally, Rugg (as cited in Plous, 1993) exhibited a framing effect in a poll in which the same option was expressed differently. Rugg (as cited in Plous, 1993) discovered that 62% of people disagreed with allowing public condemnation of democracy, but only 46% of people agreed to forbidding public condemnation. The framing effect accounts for the 16% disparity in these effectively congruent decisions (as cited in Plous, 1993). Therefore, framing could have negative social and political implications. Druckman (2001b) also conveys that these effects could discredit public opinion, rendering polls as dubious sources of information.

Eliminating Framing Effects

One of the dangers of framing effects is that in the reality, people are often only provided options within the context of one of the two frames (Druckman, 2001a). Furthermore, framing effects may persist even when monetary incentives are provided (Tversky & Kahneman, 1981). Thus, individuals’ decisions may be malleable through manipulation with the framing effect, and the consequences of framing effects may be inescapable. However, Druckman (2001b) conveys that the framing effects and their societal implications may be emphasized more than they should be. This notion is reflected, as he demonstrated that the effects of framing can be reduced, or even eliminated, if ample, credible information is provided to people (Druckman, 2001b). On the other hand, framing effects may not always be too detrimental in human judgment. After all, if options always were presented employing both a loss and a gain frame, making decisions could become a more mentally strenuous and confusing process than it was initially.

References

• Druckman, J. (2001a). Evaluating framing effects. Journal of Economic Psychology, 22, 96 - 101.
• Druckman, J. (2001b). Using credible advice to overcome framing effects. Journal of Law, Economics,
• and Organization, 17, 62–82.
• Gätcher, S., Orzen, H., Renner, E., & Stamer, C. (in press). Are experimental economists prone to framing effects? A natural field experiment. Journal of Economic Behavior & Organization.
• Plous, S. (1993). The psychology of judgment and decision making. New York: McGraw-Hill.
• Tversky, A. & Kahneman, D. (1981). The Framing of decisions and the psychology of choice. Science, 211, 453-458.