Concept
The framing effect
The framing effect is the finding that the same fact, worded as a gain or as a loss, produces different decisions. Ninety percent survival and ten percent mortality describe one treatment and lead to two choices.
Kahneman and Tversky showed that people are not indifferent to how logically equivalent options are described. A surcharge for cards and a discount for cash are the same price and feel different. A project that is 80 percent done and one with 20 percent still to do feel like different projects. Because loss aversion makes losses loom larger than gains, the loss frame usually pushes harder, which is why salespeople and negotiators reach for it. Knowing about framing does not make you immune; the defence is a step in the process: write the key fact both ways and see whether your choice moves.
A real-life example
A job offer is a 15 percent gain in salary and a 40 percent loss of weekday time with the children. Written only the first way, it looks obvious; written both ways, the decision looks different, and the difference is the frame.
How to use it
- 1Write the main fact of a decision once as a gain and once as a loss.
- 2If your choice flips, the frame was choosing; decide again on the substance.