- Frames as Gains vs Losses – we naturally want to avoid losses. Researches have revealed that people are risk averse when a problem is posed in terms of gains but risk seeking when a problem is posed in terms of avoiding losses.
- Framing with different reference – different reference points will get different responses. Studies have shown that many people would refuse the 50-50 chance for a choice with reference point of zero (neutral) but accept a choice with positive reference point putting things into perspective by emphasizing the real financial impact of the decision.
What can you do about this? You can
- Always reframe the problem in various ways and observe distortions caused by the frames;
- Try posing problems in a neutral, redundant way that combines gains and losses or embraces different reference points
- Deliberate hard throughout the process about framing trap. At the end ask yourself if you would change your mind if the question is asked differently;
- When others recommend decisions, examine the way the framed the question. Challenge them with different frames.