The Effects of Emotions and Task Frames on Risk Preferences in Self Decision Making and Anticipating Others' Decisions

Abstract

Although many researchers explore the effects of decision process emotions and task frames on risk preferences in self decision making (e.g., Clore Schwarz, 1983; Slovic, 2002; Mayer, Gaschke, Braverman Evans, 1992; Loewenstein, Weber Hsee, 2001; Isen Patrick, 1983; Kahneman Tversky, 1979), few researchers examine their impacts on risk preferences in anticipating others’ decisions (e.g., Hsee Weber, 1997; Wallach Wing, 1968)). In this study, two experiments are presented to compare the effects of emotions and task frames in self decision making and anticipating others’ decisions. Experiment 1 used two film clips as materials to induce 80 undergraduate subjects’ happiness or sadness emotions, then asked subjects to either make choices for themselves or anticipate others’ choices on a risk preference questionnaire including ten items. In experiment 2, task frame variables were introduced to examine the complex relations among emotions, the decision maker’ roles and task frames. The 96 undergraduate subjects were asked to either make choices for themselves or anticipate others’ choices on a risk preference questionnaire including seven items under happiness or sadness emotion, and gain or loss frame conditions. The results of the two experiments showed that (1) In gain frames, the sadness emotion produces stronger risk preferences than the happiness emotion, and making choices for themselves shows stronger risk preferences than anticipating others’ choices. (2) In loss frames, the happiness emotion produces stronger risk preferences than the sadness emotion, and anticipating others’ choices produces stronger risk preferences than making choices for themselves; (3) In making decisions for themselves, the happiness emotion produces stronger risk preferences under the loss frame than under the gain frame, but the sadness emotion produces stronger risk preferences under the gain frame than under the loss frame. In contrast, in anticipating others’ decisions, the loss frame always produces stronger risk preferences than the gain frame, regardless of happiness emotion or sadness emotion. These results do not concur with the general findings about framing effects (Kahneman Tversky, 1979) and self-other decision bias (Hsee Weber, 1997; Wallach Wing, 1968), and suggest that there are complicated interaction among emotions, task frames and the decision maker’ roles. Rather, the effects of emotions and task frames on risk preferences depend on the decision maker’ roles.