Games
Task
Games to understand human behavior
Concepts just experienced
Framing Effect
Decoy Effect
Emotional Contagion
A Medical example
Let’s use an example from what is going on around us.
Assume 600 people have contracted the Ebola virus. Scientists have discovered two treatment programs.
You must decide which program is used for your citizens. A Medical example
Problem 1:
Program A adopted, 200 people will be saved
Program B adopted, 1/3 prob of 600 saved, 2/3 prob no people are saved
72% of Ss prefer A
Problem 2:
Program A adopted, 400 people will die
Program B adopted, 1/3 probability nobody will die, 2/3 prob. 600 will die
78% prefer Program B!
Why?
Difference between 200 saved and 600 saved is subjectively smaller than between 400 dead and 0 dead. Framing effects are especially strong in decisions regarding life and death.
Framing Effect: Mad Science
Framing Effect: Mad Science
Framing of the question
Framing Effects
Framing effects are observed when the same problem is presented either as a loss or gain
Options that don’t differ in level of risk are presented in different ways.
Same choices will be available (between risks), but they will be framed either positively or negatively.
Summary of risky choice framing
People prefer certainty in the face of gains and uncertainty in the face of loss
People exhibit RISK TAKING in the face of losses and RISK AVOIDANCE in the face of gain.
Losses loom larger than gains.
Best explanation of risky choice framing comes from prospect theory.
Huber & Puto (1983)
Situation 1
Battery A: lasts 22 hours and costs $1.80
Battery B: lasts 28 hours and costs $2.10.
Battery C: lasts 14 hours and costs $1.50
No one chooses Battery C when it is present.
When Battery C was in the set, more than 60% of people chose Battery A.
Huber & Puto (1983), cont….
Situation 2
Battery A: lasts 22 hours and costs $1.80
Battery B: lasts 28 hours and costs $2.10.
Battery D: lasts 32 hours and costs $2.70
No one chooses Battery D when it is present.
When Battery D was in the set, about 60% of people chose Battery B!
Why the difference?
The third alternative can make one of the others look like a better