The Framing Effect: An Examination Involving High-Payoff and Low-Payoff Scenarios

The framing effect is a phenomenon of interest in the domain of human cognition. Its main premise is that decision-making is affected by the language in which the background information presented. Gonzales, Dana, Koshino, and Just (2005) summarize the effect well: when decision-making scenarios are framed as a gain, people tend to select sure-option decisions; when those scenarios are framed as a loss, people tend to select more risky decisions. This phenomenon occurs even when the expected values are equal. For example, imagine a problem in which someone is told that an emerging flu strain is expected to kill 6,000 people. The person is given descriptions of two programs to combat the flu and is asked to express which program he favors. In Program 1, 2,000 people are expected to be saved. In Program 2, there is a one-third probability that everyone (6,000 people) will be saved and a two-thirds probability that no one will be saved. Because the programs are described in terms of lives saved (gain-framed) instead of lives lost (loss-framed), the person is more likely to select the sure option (or Program 1, where the proposed option has a 100% chance of occurring) than the risky option (or Program 2, where probabilities of occurrence are assigned to either of two outcomes).