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Monday, July 18, 2016

How Language ‘Framing’ Influences Decision-Making

Observations
Association for Psychological Science
Published in 2016

The way information is presented, or “framed,” when people are confronted with a situation can influence decision-making. To study framing, people often use the “Asian Disease Problem.” In this problem, people are faced with an imaginary outbreak of an exotic disease and asked to choose how they will address the issue. When the problem is framed in terms of lives saved (or “gains”), people are given the choice of selecting:
Medicine A, where 200 out of 600 people will be saved
or
Medicine B, where there is a one-third probability that 600 people will be saved and a two-thirds probability that no one will be saved.
When the problem is framed in terms of lives lost (or “losses”), people are given the option of selecting:
Medicine A, where 400 out of 600 people will die
or
Medicine B, where there is a one-third probability that no one will die and a two-thirds probability that 600 people will die.
Although in both problems Medicine A and Medicine B lead to the same outcomes, people are more likely to choose Medicine A when the problem is presented in terms of gains and to choose Medicine B when the problem is presented in terms of losses. This difference occurs because people tend to be risk averse when the problem is presented in terms of gains, but risk tolerant when it is presented in terms of losses.

The article is here.
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