Summary of an article called The Framing of Decisions and the Psychology of Choice - Essay Example

Usually, a decision problem presents the person involved with acts or options he must take in order to satisfy a specific need. The term "decision frame" has been used in the article to refer to the decision-maker's conception of the acts, outcomes, and contingencies associated with a particular choice. People have various perceptions toward a particular situation of problem frame. When people are presented with a similar problem, they can make decisions that are totally different but what is of importance is that each individual reaches a decision after weighing all the alternative options.

After doing this, he chooses the best option that will satisfy his or her needs. Therefore, decision making is a matter of choice. The researchers of this paper utilised the utility model when they carried out this study. This model posits to the effect that people often make decisions on the basis of the utilities they will obtain from carrying out that particular action. According to the authors of this research paper, when faced with a choice, rational people often opt for a prospect that will offer them the highest utility expected from such action.

However, the authors also suggest that the utility model may be incompatible with the choices made by people towards a certain situation. In the prospect theory, outcomes are expressed as positive or negative deviations meaning to say that they are expressed as gains or losses (Tversky & Kahneman, 1981). Thus, if there are prospects of gaining from a certain scenario, then a positive decision is likely to be made. The authors also posit to the effect that a risky prospect is preferred to a riskless prospect.

This emanates from the widely held belief that risk takers are in most cases assured of success in business. In terms of business decision making, people who are scared of risks are not great achievers in their business prospects. Risk in some cases is associated with success. The outcome of a certain action mainly influences people to take a certain course of action. Many decisions are framed independently where the decision maker has the opportunity to closely assess the problem so as to be in a better position to come up with a meaningful option.

As human beings, we all have needs which ought to be satisfied. However, this can be achieved if we make wise decisions that can help us to realise our aspirations. In some cases, the decisions are predictable while in some instances they are not. If an outcome of a situation is not predictable, then that decision may require the person involved to broadly analyse the situation. The decisions made by a person affect his or her life in many ways. Therefore, the choice of making a decision is independent and it can be seen that people can have different perceptions towards the same situation.

The paper sought to investigate the factors that influence people in their decision making process. Before a decision is made, a person often asks himself a question related to the outcome of that decision. For instance, the person involved may want to know what he or she will obtain from the decision made. Consistency which is one aspect of rational behaviour has been questioned since all people cannot make consistent decisions as a result of the fact that they may have different pe