What happened
You made a series of choices between certain and risky options. Interleaved pairs were mathematically identical but framed as gains or losses. The divergence between your matched answers measures your framing susceptibility.
Why it happened
Prospect theory's value function is concave for gains (making sure gains attractive) and convex and steeper for losses (making sure losses repellent). The frame sets the reference point, which determines whether the same outcome is coded as a gain or a loss.
Experimental design
Research protocol
Between-subjects (gain frame vs. loss frame); Asian disease problem
- Independent variable (IV)
- Outcome framing (lives saved / positive frame vs. lives lost / negative frame)
- Dependent variable(s) (DV)
- Choice proportion for risky vs. certain option
- Preference reversal across matched frames
- Measured constructs
- Risk preferenceDecision making under uncertaintyReference dependence
- Operational definitions
Framing effect
Systematic preference shift when equivalent outcomes are described as gains or losses
Loss aversion
Asymmetric weighting: losses loom larger than equivalent gains (λ > 1 in prospect theory)
Reference point
Status quo or baseline from which outcomes are coded as gains or losses
- Key terms
Prospect theory
Descriptive model of choice under risk: value is defined over gains/losses, not final wealth (Kahneman & Tversky, 1979).
Invariance axiom
Rational choice requires preferences over outcomes to be independent of description; violated by framing.
Risk seeking in losses
Convex value function for losses leads people to gamble to avoid sure losses.
The original experiment
Year
1981
Researchers
Amos Tversky · Daniel Kahneman
Sample
307 respondents across framing conditions
Key finding
Preference reversed from 72% risk-averse under a gain frame to 78% risk-seeking under a loss frame for identical outcomes.
Tversky, A., & Kahneman, D. (1981). The framing of decisions and the psychology of choice. Science, 211(4481), 453–458.
Where this shows up in the world
Medical consent: '90% survival' vs '10% mortality' changes treatment uptake
Public policy defaults and pension enrollment design
Pricing: discounts versus surcharges for the same price difference
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