Concluding Remarks: FRAMING

• Why does framing work?

1) Nonlinearity of value function.

2) Options evaluated in relation to reference points.

3) Different risk attitudes toward gains and losses.

• Why does framing matter?

  • Power to person who presents options to decision makers
  • Framing may change our experience of outcomes.

• So what should we do?

1) Be aware of the phenomenon.

2) Think holistically.

3) Evaluate options in terms of actuarial consequences (not psychological ones).

4) Reframe: Systematic examination of alternate frames.

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