Mean and Variability Effects in Decision Framing

Abstract

Framing a decision as a rejection can lead consumers to form preferences that are different from those that they would form if that same decision were framed as a choice. These differences in preferences are called preference reversals. This paper extends research in this area, using a sequence of five studies to show that framing can change both mean preference and preference variability. The first study uses Discrete Choice Experiments to demonstrate the effects of framing a decision as a choice or rejection on decision outcomes. Study 2 uses eye tracking to highlight that differences in information gathering during the experiment are unlikely to account for this difference. Studies 3 through 5 demonstrate that differences in framing can be reduced through increasing task familiarity. A lack of familiarity with the task of rejecting leads consumers to change their mean preferences and also increases their preference variability for high- and low-preferred products, compared to when they are choosing. These changes in preferences cease to occur when familiarity with rejection increases, but only when that familiarity is specific to the product context under examination. This demonstrates that framing can be used to influence consumer preferences in two ways. Keywords: Choice, Rejection, Framing, Variance, Familiarity To cite this document: Luke Greenacre, "Mean and Variability Effects in Decision Framing", Contemporary Management Research, Vol.12, No.3, pp. 309-336, 2016. Permanent link to this document: http://dx.doi.org/10.7903/cmr.15017