Abstract for Choices, Values, and Frame
Reading 2.2
Kahneman,D and Tvesky, A. (1984), ‘ Choices, values, and frames’. Ameriacn Psychologist, 39 (4)
Abstract
This article discuss when consumers feel a certain price which is bringing the "loss" rather than the "income", they are more sensitive to price. Consumers are feeling a certain price more cost-effective manner and the other a less cost-effective. They will accord the cognitive psychological evaluation to exhibit a completely different personal attitude and decision making. Economic decision making theory has always been that people are fundamentally rational animal. However, human beings have irrational features in many aspects. One of the most attract somebody 's attention example is calling the “framing effect" In this effect, the positive or negative way to make a decision has had a dramatic effect on subsequent choice. The researchers found that integration from the decision system of emotional preference were potential causes of framing effect. With the potential risk benefit choices need to pay the cognitive effort than defined benefit choice; however, determining the damaged choice and risk selection potential damage to pay cognitive effort is the same. There are two fundamental analyze principles for rational choice theory: dominance and invariance. Dominance can be defined that project A in the worst case is better than project B, project A should be accept. Invariance requires that human describe selectivity problem for the same thing that will draw the common preference. Framing effect can be divide two types: positive and negative. The positive frame shows risk-averse preference for gains. On the other hand, the negative frame shows risk- seeking preference for losses. In addition, in mental accounting, money can be attributed to the different types of account which cannot replace each other. People are always divide outcomes into different mental accountings and use decision value and experience value, in order to evaluate the
Kahneman,D and Tvesky, A. (1984), ‘ Choices, values, and frames’. Ameriacn Psychologist, 39 (4)
Abstract
This article discuss when consumers feel a certain price which is bringing the "loss" rather than the "income", they are more sensitive to price. Consumers are feeling a certain price more cost-effective manner and the other a less cost-effective. They will accord the cognitive psychological evaluation to exhibit a completely different personal attitude and decision making. Economic decision making theory has always been that people are fundamentally rational animal. However, human beings have irrational features in many aspects. One of the most attract somebody 's attention example is calling the “framing effect" In this effect, the positive or negative way to make a decision has had a dramatic effect on subsequent choice. The researchers found that integration from the decision system of emotional preference were potential causes of framing effect. With the potential risk benefit choices need to pay the cognitive effort than defined benefit choice; however, determining the damaged choice and risk selection potential damage to pay cognitive effort is the same. There are two fundamental analyze principles for rational choice theory: dominance and invariance. Dominance can be defined that project A in the worst case is better than project B, project A should be accept. Invariance requires that human describe selectivity problem for the same thing that will draw the common preference. Framing effect can be divide two types: positive and negative. The positive frame shows risk-averse preference for gains. On the other hand, the negative frame shows risk- seeking preference for losses. In addition, in mental accounting, money can be attributed to the different types of account which cannot replace each other. People are always divide outcomes into different mental accountings and use decision value and experience value, in order to evaluate the