RISK SEEKING PREFERENCES: AN INVESTIGATION OF FRAMING EFFECTS ACROSS DECISIONAL DOMAINS

Authors

Renata M. HEILMAN^1,*, Mircea MICLEA^1,2

¹ Department of Psychology, Babeș-Bolyai University, Cluj-Napoca, Romania
² Cognitrom Ltd., Cluj-Napoca, Romania

ABSTRACT

The framing effect refers to the fact that presenting the descriptions of equivalent decisional alternatives in different terms results in the preference for one alternative over the other, depending on the description format. Changing one’s preference for a decisional outcome, depending on the wording of those outcomes, represents a violation of the principle of invariance, one of the cornerstones of the decision maker’s rationality. Since previous framing-related empirical work highlighted some contradicting results regarding the existence or magnitude of risky choice framing effects, our research objective was to investigate whether framing effects are consistent between and within decision-making domains. Participants were presented with nine hypothetical decisional situations related to health, financial or nature and objects domains. The equivalent decisional alternatives were framed in either gain or loss terms. We analyzed the impact of framing on participants’ level of risk seeking in the decisional situations. Our results add to the existing literature by indicating that framing effects are not consistent between decisional domains. Framing effects were present for health and nature and objects domains, but not for the financial domain. More importantly, we also found that within the same decisional domains, different problems elicit varying levels of framing effects. One possible explanation for the differences found between decisional domains might involve the emotional reaction triggered by the decisional problems. Implications of framing effects for different real-life decisions are discussed.

KEYWORDS: framing effects, risk taking, decisional domains, decision

PAGES:1-17

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