## Monday, 28 May 2012

### Loss Aversion, Risk, & Framing

The next stop in the framing inquiry involves the unique relationship of risk taking to positive and negative framing. Since losses loom larger than gains, it appears that humans follow conservative strategies when presented with a positively-framed dilemma, and risky strategies when presented with negatively-framed ones. To illustrate, consider Kahneman & Tversky's 1984 study where they asked a representative sample of physicians the following question. Read and answer it before you continue.

Imagine that the U.S. is preparing for the outbreak of an unusual Asian disease, which is expected to kill 600 people. Two alternative programs to combat the disease have been proposed. Assume that the exact scientific estimates of the consequences of the programs are as follows: If program A is adopted, 200 people will be saved. If program B is adopted, there is a one-third probability that 600 people will be saved and a two-thirds probability that no people will be saved. Which of the two programs would you favor?

Be sure to answer this question before you proceed.
Notice that the preceding dilemma is positively framed. It views the dilemma in terms of "lives saved." When the question was framed in this manner, 72% of physicians chose A, the safe-and-sure strategy, but only 28% chose program B, the risky strategy. An equivalent set of physicians considered the same dilemma, but with the question framed negatively:

Imagine that the U.S. is preparing for the outbreak of an unusual Asian disease, which is expected to kill 600 people. Two alternative programs to combat the disease have been proposed. Assume that the exact scientific estimates of the consequences of the programs are as follows: If program C is adopted, 400 people will die. If program D is adopted, there is a one-third probability that nobody will die and a two-thirds probability that 600 people will die. Which of the two programs would you favor?

You can see that the two questions examine an identical dilemma. Two hundred of 600 people saved is the same as 400 of 600 lost. However, when the question was framed negatively, and physicians were concentrating on losses rather than gains, they voted in a dramatically different fashion. When framed negatively, 22% of the physicians voted for the conservative strategy and 72% of them opted for the risky strategy!

As you can see, framing the choice positively vs. negatively caused an almost perfect reversal in the choices of highly-trained experts making a decision in their field of expertise--saving (or is that 'not losing'?) lives! Clearly, framing can powerfully influence the way a problem is perceived, which in turn can lead to the favoring of radically different solutions.

Let's consider the same "negative frame => risky behavior" phenomenon from a somewhat less theoretical and more practical perspective. Imagine that you are a medical practitioner, and you have just seen your third case of advanced breast cancer in a single week. "Why," you wonder to yourself, "aren't these women performing breast self-exams (BSEs) and finding these lumps before they become full-fledged, life-endangering metastatic cancers?" Your clinic hands a brochure on BSE to every woman that enters the door, BSE is regularly described in newspapers and on TV; information on this topic isn't exactly scarce! Why do your patients choose to die rather than comply? you wonder.

But consider the act of a BSE. Logically, it's safe--but psychologically, it's a risky procedure. If you perform BSE, you may feel a lump. So performing BSE is a risky behavior, because by looking, you may find something you don't want to find. Not performing a BSE is a logical health risk behavior, but is safer psychologically. By not looking, you won't find anything that may cause you to worry.

Researchers Meyerowitz and Chaiken explored this very question in a 1987 research project. They distributed one of two brochures on BSE to equivalent patients in equivalent clinics. The brochures were identical in terms of content, but one stressed the gains associated with performing a BSE, and the other focused on the losses associated with inaction. You can guess the result, can't you? The negatively-framed brochure lead to higher positive BSE-related attitudes and behaviors. Actually, the true strength of the negative frame emerged four months after patients received the brochures. Those who received negatively-framed brochures showed significantly greater intentions to perform BSE at the later date.

Why is it that negative information causes increased persuasion in these types of situations? Psychologists have long known of the existence of the "positivity bias," which states that humans overwhelmingly expect good things (as opposed to neutral or bad things) to occur. If perceivers construct a world in which primarily positive elements are expected, then negative information becomes perceptually salient as a jolting disconfirmation of those expectations (Kanouse & Hanson, 1972). We also know that people stop to examine disconfirmations to a much higher degree than confirmations. Negative information is often highly informative and thus may be assigned extra weight in the decision-making process (Fiske, 1980; Smith & Petty, 1996). Let me ask you: if you learned that your friend's auto mechanic performed an excellent valve job but botched his automatic transmission repair, would you take your car to that mechanic? No, because negative information overwhelms positive information. You expect a mechanic to be effective, period.

This topic is considered in further detail for the benefit of my students, who must enter the URLs found on the syllabus to access the following pages (if you're not a student of mine, please don't ask! The answer will be "Sorry."):
• Positive & Negative Frames (They're both effective in the appropriate circumstances, but you need to know which is best to use when.)
• Why Experts Fail to Predict (One reason experts make stupid mistakes.)
• Framing by Position (The real reason for the cheap and expensive models in the product lineup.)
• Framing by Contrast (How contrast is used to make you do things you wouldn't otherwise do.)
• Framing by Attribution (One of the most seductive persuasion tactics around because it makes people feel good!)

Ref:
http://www.workingpsychology.com/lossaver.html

http://www.workingpsychology.com/mediafr.html
Media framing (How the media frames the news and shapes public opinion.)