Understanding the Framing Effect: How Context Influences Decision-Making

Introduction

The framing effect is a cognitive bias that significantly impacts decision-making processes by altering people’s perceptions based on how information is presented. This report aims to explore the concept of the framing effect, highlighting its implications in various contexts, including marketing, politics, and healthcare. By examining empirical studies and theoretical frameworks, the purpose of this report is to elucidate how context can shape individuals’ choices and judgments, often leading to irrational or suboptimal decisions.

Main Body

The framing effect occurs when the same information is presented in different ways, leading to different responses from individuals. This phenomenon is grounded in the principles of prospect theory, developed by Daniel Kahneman and Amos Tversky, which posits that people evaluate potential