Don't like the picture? Change the frame: the impact of cognitive ability and framing on risky choice

This article identifies the effect a perceived upfront cost (UFC) has on the subsequent risky choice of older Americans with varying levels of cognitive ability. When respondents are faced with outcome alternatives framed with and without a UFC, we observe variation in respondents' required out...

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Bibliographic Details
Published in:	Applied economics letters Vol. 22; no. 18; pp. 1515 - 1518
Main Authors:	Guillemette, Michael, Browning, Chris, Payne, Patrick
Format:	Journal Article
Language:	English
Published:	London Routledge 12-12-2015 Taylor & Francis LLC
Subjects:	Aged Cognitive ability Costs Decision making Economic analysis framing Older people Risk factors risky choice Studies upfront cost
Online Access:	Get full text
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Summary:	This article identifies the effect a perceived upfront cost (UFC) has on the subsequent risky choice of older Americans with varying levels of cognitive ability. When respondents are faced with outcome alternatives framed with and without a UFC, we observe variation in respondents' required outcomes based on the order in which the two frames are presented. We provide evidence that among respondents with lower cognitive ability, losses need not be realized to affect subsequent risky choice, and that a UFC lowers the willingness to take risk in a future period.
Bibliography:	ObjectType-Article-1 SourceType-Scholarly Journals-1 ObjectType-Feature-2 content type line 23
ISSN:	1350-4851 1466-4291
DOI:	10.1080/13504851.2015.1044643