Risky choice framing: Task versions and a comparison of prospect theory and fuzzy-trace theory

Framing effects are said to indicate irrationality in decision making because they illustrate that linguistically different descriptions of equivalent options lead to inconsistent choices. A review of the literature on the effects of adding, or subtracting, implicated complements of the sure option...

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Bibliographic Details
Published in:Journal of behavioral decision making 2010-07, Vol.23 (3), p.314-329
Main Authors: Kühberger, Anton, Tanner, Carmen
Format: Article
Language:English
Subjects:
Cognitive psychology
Comparative analysis
complementarity
Decision making
Decision making models
Experimental psychology
Framing
Fuzzy logic
fuzzy-trace theory
Impact analysis
Management science
Operations research
Organizational research
prospect theory
rationality
risk
Risk assessment
Studies
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Summary:Framing effects are said to indicate irrationality in decision making because they illustrate that linguistically different descriptions of equivalent options lead to inconsistent choices. A review of the literature on the effects of adding, or subtracting, implicated complements of the sure option shows that this leads to a classic framing effect, a reversal of the classic effect, or no framing effect. Thus, the assumption of equivalence of formulations is not justified. In addition we provide a test of two major, but opposing theories on framing, prospect theory and fuzzy‐trace theory. Based on an online study we investigated the effects of subtracting complements of the risky option. The results are more consistent with fuzzy‐trace theory than with prospect theory. The consequences of these findings for the application of formal models like prospect theory, and for rationality, are discussed. Copyright © 2009 John Wiley & Sons, Ltd.
ISSN:0894-3257
1099-0771
DOI:10.1002/bdm.656