Framing, or frame effect, is one of the most common behavioral errors among savers. According to this effect, the decisions made by individuals differ depending on the way in which identical questions are “framed.”
In fact, in many cases, the available alternatives can be formulated in a way that highlights positive or negative aspects of the same problem, leading to changing our reactions. Let’s discover, through this Psychology-Online article, what is the frame effect in psychology and how it can influence the decisions we make in everyday life. In addition, we also show you examples of this effect so you can identify it.
What is the frame effect in psychology
The framing effect is called framing dependence. In fact, the term fragming means framed and refers to a process of influence on the perception of meanings that a person attributes to words or phrases.
Amos Tversky and Daniel Kahneman developed this definition in 1979 within their prospect theory. They explained that “positive” and “negative framing” leads to very different results.
Specifically, the frame effect bias occurs when, by modifying the conceptual structure of a decision problem, changes occur in the choices of individuals. In short, by changing the order of the factors, the product will change, while, according to the principles of rationality, it should not change at all.
Types of frame effect
Three different types of framing effect based on different cognitive processes have recently been identified. We see them below:
- Attribute Framing: A level of drowsiness associated with a moderate risk of making driving errors can be described as greater than the optimal conditions of no risk or as less than the worst conditions of high risk. Studies on this type of framing indicate that more negative evaluations are obtained when the object of evaluation is linked to a low level of risk with respect to which losses are emphasized.
- Framing of the objectives: To try to convince a population to behave to reduce the level of drowsiness while driving, one can emphasize the positive consequences of implementing a certain behavior or the negative consequences of not implementing that behavior.
- Framing of decisions: The choice between two different ways to lower the level of sleepiness, of equal expected value, but one with uncertain consequences and the other with certain consequences, is affected by the way in which the consequences of the two options are described. For example, such as failure to achieve certain objectives.
How the framing effect affects decision making
When it comes to understanding how the frame effect affects, it is best to look at a practical case like the following:
- We have to do a very complex operation at work. There is a 10% chance it will go wrong and we will be fired. In this phrase we notice that there is more risk of losing.
- We have to do a very complex operation at work. There is a 90% chance that everything will turn out well. This phrase gives us confidence that everything will be fine, leaving aside the 10% difference.
So what does the framing effect bias mean? Basically, that the change in the probability of the Framed information does not change the volume of exchanges, only the perception. In general, they will cope with the complex operation at work if it is proposed in the second way, but if it is presented as in the first option, they will hardly do it.
Therefore, to influence the decisions of others, it is essential to give a positive perspective, in addition to taking into account the tone with which we communicate the task.
Examples of the frame effect in marketing and economics
The ingenious experiments carried out by Kahneman and Tversky, with the participation of volunteers, showed that, in general, individual decision-making does not satisfy the hypotheses of rationality of economic agents. According to the framing effect, an agent changes its decision when faced with the same choice problem if it is presented in different ways.
Example #1 of the frame effect
These experimental results have opened the way to research under the name of behavioral economics, including alternative models to the rationality of agents.
Experiments in economics tend to emphasize the generality of a situation and the role of monetary incentives. In them, the psychological approach, which underlies the framing effect, highlights the role of intrinsic individual motivations and mental processes in a particular decision-making situation. Let’s look at the following choice problem proposed by Kahneman and Tversky to understand it better:
- Option 1: buy at a certain store a stereo for $125 and a calculator for $15 or go to a store further away where the calculator is offered at a $5 discount.
- Option 2: buy a stereo for $125 and a calculator for $15 at a certain store, or go to a store further away where the stereo is offered at a $5 discount.
The problem is equivalent because the total savings is the same. However, laboratory results showed that the proportion of people who choose to go to the second store is significantly higher in the first case, where the discount is applied to the lowest priced asset. Therefore, it looks cheaper in relative terms. This simple result violates the hypothesis of transitivity of the preferences of a rational agent.
Example #2 of the frame effect
The two scholars present many other examples of the framing effect in the case where individuals must make decisions under conditions of uncertainty. Let’s look at an example of this: there are two alternative treatments for a fatal disease that affected 600 people and this problem can be approached in two ways:
- Approach 1: The first treatment saves the lives of 200 people and the second treatment saves everyone with a probability of 33%, or none with the remaining probability of 66%.
- Approach 2: 400 people die with the first treatment and with the second treatment there is a 33% probability that no one will die and a 66% probability that everyone will die.
In this case, the two formulations of the same problem produced opposite results. On the one hand, the vast majority of participants in the first approach chose the first option and vice versa in the second.
Based on these results, Kahneman and Tversky proposed the so-called prospect theory, according to which the individuals They value the possibility of gains or losses differentlyThat is, they tend to avoid risk in the face of a positive event and, on the contrary, seek it in the face of a negative one. If you want to analyze other situations, we suggest you consult this article on the .
This article is merely informative, at Psychology-Online we do not have the power to make a diagnosis or recommend a treatment. We invite you to go to a psychologist to treat your particular case.
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Bibliography
- Ordine degli Psicologi del Lazio (2005). Road psychology. Gli intervention of the psychologist to optimize the uomo-veicolo-strada system. Milan: Franco Angeli.
- Villa, E. (2016). Cos’è il framing and perché influenza our investment decisions. Retrieved from: https://www.risparmiamocelo.it/cose-il-framing-e-perche-influenza-le-nostre-decisioni-di-investimento/