Fairness as a social cue and verbal framing in risky choices: An examination of the ambiguity and ambivalence hypothesis

Abstract

This research explores how fairness, as a social cue, affects one’s preference when making a choice between differently framed outcomes. To achieve this, we conducted two studies. In Study 1, we analyzed how the perception of fairness embedded in options for addressing a life-or-death problem (based on the Asian disease problem), framed either in terms of lives saved or lives lost, affects behavioral decision making. As existing data suggests that perceived fairness may mediate the effect the framing of a situation has on the decision made. In Study 2, we manipulated the fairness perception of “sure” options in order to investigate how participants’ choice preferences would consequently vary. We found that the framing effect only occurred when the distribution method was fair; it did not occur for distribution methods that were less fair. This result suggests that people assign differing priorities to social and verbal cues; when making the Asian disease problem decision, participants set the social cue of fairness as a high priority. We also found that verbal framing of choice outcomes as secondary cues is more effective in cases when using primary cues leads to conflicting preferences; this is consistent with the prediction of the ambiguity and ambivalence hypothesis, which provides an approach for exploring the social context mechanisms underlying inconsistency and bias when making risky choices.