How does the framing effect influence decision-making?

The framing effect significantly influences decision-making by altering how options are perceived based on the way information is presented. This cognitive bias suggests that individuals do not evaluate choices solely based on their inherent value; rather, they are affected by the context or format in which those choices are framed. For example, describing a medical treatment with a success rate of 90% may lead individuals to choose it over one described as having a failure rate of 10%, even though both statements convey the same information.

In this way, the framing effect can lead to different decisions, even when the underlying facts remain unchanged. The choice of words, the perspective taken (positively or negatively framed), and the context can all shape perceptions and, consequently, influence the decisions made. This concept is central to understanding decision-making processes in psychology and has implications in various fields, such as marketing, healthcare, and behavioral economics.