The Framing Effect Bias: Improving Decision Making Skills For Cognitive Misers

 

A Cornell University study reported this month reveals that U.S. intelligence agents are more likely to make irrational life-death decisions than college students, basing their decisions on the superficial wording of the information rather than the real facts and probabilities.

It’s not just intelligence agents that make irrational decisions, it’s everyone to a greater or lesser degree. In critical situations our decision making skills can be very shaky, no matter how high we score on an IQ test, due to what psychologists call cognitive biases – built in ‘bugs’ in our cognition. These can get worse with ‘experience and expertise’, as is the case with intelligence agents.

This article explains the basis of these cognitive biases with examples, and how serious their impact can be on our lives. It also explains why and how we can improve our decision-making skills with capacity-strategy brain training.

 

Are You a ‘Cognitive Miser’? Proofs of Our Cognitive Laziness!

Try to solve this problem that I recently posted on IQ Mindware’s Facebook page

Jack is looking at Anne, but Anne is looking at George. Jack is married but George is not. Is a married person looking at an unmarried person?

Yes      No      Cannot be determined

Chances are you scanned the problem briefly, figured that you need to know if Anne is married to know the answer and concluded that the answer is ‘Cannot be determined’.

But this answer is incorrect.

Now  take another look at the problem, and use the following advice – think about the problem LOGICALLY, considering ALL THE POSSIBILITIES for Anne’s marital state.

Time out while you solve the problem….

Here’s what you may have reasoned out to solve this problem: If Anne is unmarried, then a married person ( Jack) is looking at an unmarried person (Anne). If Anne is married, then a married person (Anne) is looking at an unmarried person (George). Either way, the answer is yes.

Now many of you will have figured this when prompted to be more logical.  But to do this, you needed to invest more time and mental effort. It wasn’t that you were not intelligent, but that you were – for this problem – cognitively lazy – or as psychologists say, a cognitive miser.

Here’s another problem from the well-known Cognitive Reflection Test that helps prove that we are cognitive misers.

A bat and ball together cost $1.10. 
The bat costs $1.00 more than the ball.
How much does the ball cost?

For most people 10 cents came to mind right away. But what popped into the mind straight off here is incorrect. If the ball was .10, and the bat was $1more than the ball, that would make the bat $1.10, and mean they cost $1.20 together. The right answer is that ball costs 5 cents.

All we had to do to get this right was double check the sums. But figuring this out means we have to invest time and effort into reasoning the problem through. Most of us can’t be bothered to do this. We want an effortless cognitive ‘pop out’ effect.

It turns out we are all cognitive misers to some extent. Thinking things through logically and systematically is time-consuming, energy-consuming, and sometimes counter-productive. Thinking logically requires self-control and self-control consumes energy in the brain – energy that might be used more productively elsewhere.

 

The Good News: Having a High IQ is Consistent with Being Lazy

Being cognitively lazy isn’t all bad. It can lead to more efficiency – more results for less effort…the ‘Pareto 80-20’ principle that is so loved in the IQ Mindware community.

Our brains are designed to quickly absorb and make use of rules of thumb and easily accessible information that help us quickly and efficiently solve problems and make decisions, limiting the amount of brainpower we bring to bear on a problem.

Your general intelligence can be defined as:

Your ability to reason, problem solve, decide, learn & act efficiently & successfully in the pursuit of your valued goals.

To act ‘efficiently and successfully in pursuit of our goals’ often doesn’t require much reasoning and analysis. We simply don’t need to get bogged down in logical chains of thought and calculations most of the time, and can rely on automatic responses and what pops into our minds intuitively, particularly if the situation is well-known to us.

 

System 1 and System 2 Thinking

 

Cognitive Load and IQ

Cognitive scientists like Daniel Kahneman call intuitive, automatic thinking System 1 thinking, and energy-consuming, analytic System 2 thinking. Most of the time System 1 thinking allows us to function just fine in our day to day lives.

System 1 thinking reduces the our ‘cognitive load’ – the amount of information we need to process in our working memory.

An example of a useful System 1 heuristic is the familiarity heuristic – using ‘schemas’ to predict outcomes in a situation based a experience of that situation before.  If we’re late on a date and the date starts off cold and unfriendly, we may use this experience to ensure we’re not late again. We don’t systematically do a number of controlled experiments with our date to establish with certainty the root cause of her coldness. We save time and get on with our lives.

 

The Bad News: Being Smart Does Not Help With ‘Cognitive Bias’ Blind spots

These heuristics provide rough and ready answers that are right a lot of the time – but not always. And this is where we can run into problems, no matter how high our IQ is. The heuristics we use in some situations are better described as bugs in our cognition– systematic errors, faults, flaws in the way we problem solve or make decisions. Cognitive scientists call these systematic errors in reasoning – cognitive biases – and they have been studied in depth since the seminal work of Kahneman and Tversky in the 70s.

And what has been clearly established is that many of these biases – including the framing effect we will look at next – are not reduced by having a higher IQ.

With many cognitive biases, you are equally irrational, and equally likely to make a bad decision, whether your IQ is 70 or 130.

This means that improving your general intelligence (G) often does not help you improve your problem solving and decision making skills. You need to use other tactics to become a better decision maker.

 

The Framing Effect: One of the Worst Cognitive Biases of them All

One of the most compelling and persistent cognitive biases that plague our decision making competence is the framing effect. You can experience this cognitive bias first hand by considering the following dilemmas.

 

Dilemma 1

The U.S. is preparing for the outbreak of an unusual disease, which is predicted to affect 600 people. You are to imagine that you have the authority to choose between two treatments.

Treatment A: You save 200 lives.

Treatment B: There is a 1/3 probability that 600 will be saved and a 2/3 probability that no one will be saved.

Which treatment do you choose?

 

Dilemma 2

The U.S. is preparing for the outbreak of an unusual disease, which is predicted to affect 600 people. You are to imagine that you have the authority to choose between two treatments.

Treatment A: 400 people will die.

Treatment B: There is a 2/3 probability that all 600 will die and a 1/3 probability that no one will die.

Which treatment do you choose?

If you were like most people – no matter how high your IQ – you were more likely to choose treatment A in Dilemma 1 and treatment B in Dilemma 2.

But this is irrational. You’ve been taken in the Framing Effect Bias. If you double check you can see that the numbers and probabilities in the two dilemmas are in fact identical; they are just verbally framed in different ways – Dilemma 1 in terms of lives saved, and Dilemma 2 in terms of lives lost.

According to the research, intelligence agents, who may in fact be in positions of authority to make life or death decisions like this, are more taken in by this bias than your average college student – more likely to take risks with human lives when outcomes are framed as losses rather than gains.

In general, a “framing effect” occurs when factually equivalent descriptions of a decision scenario lead to systematically different decisions depending on how they are phrased. In our example people react differently to a particular choice depending on whether it is described as a loss or as a gain.

 

framing-effect-crash2

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Examples of the Framing Effects In Real Life

Framing effects in our day to day lives have been demonstrated by many studies.

  • We are more likely to enjoy meat labeled 75% lean meat as opposed to 25% fat.
  • 93% of PhD students registered early when the framing was in terms of a penalty fee for late registration, with only 67% registering early when the framing was in terms of a discount for earlier registration.
  • More people will support an economic policy if the employment rate is emphasised than when the associated unemployment rates is highlighted.

Interestingly, framing effects may be neutralized in a second language!

 

Cognitive Biases such as the Framing Effect can be Overcome

Cognitive biases make us irrational. The benefits of a high IQ do not extend to coping with these biases. And coping with these biases is critical to being intelligent understood more broadly.

Cognitive biases like the framing effect can be to a large extent overcome with training.

Debiasing is a technique which aims to decrease biases by encouraging us to use our working memory and self-control to override automatic, ‘pop-up’ ‘System 1’ processing (Baumeister & Bushman, 2010, p. 155). Training working memory and increasing its capacity to engage System 2 thinking can help with debiasing.

So can building up useful ‘mindware’. According to Professor Keith Stanovich from the University of Toronto who studies intelligence and rationality, ‘mindware’ is is made up of learned cognitive rules and strategies. It includes our ability to keep track of underlying probabilities when dealing with scenarios described in different but equivalent ways, how we go about doing Matrices IQ Tests, and our willingness to consider alternative hypotheses when trying to solve a problem.

IQ Mindware’s ‘capacity strategy’ brain training method is based on training working memory capacity so we have the self-control and processing power to use System 2 logical thinking when we need to. It is also based on using problem-sets and tutorials to build up our ‘mindware’ – our knowledge end strategies for better decision-making and problem solving, so we have the know-how to solve problems and make better decisions.

A high IQ alone is not enough to ensure good decision-making in real life. It helps, but we also need the self-control to snap us out of being cognitive misers and apply System 2 thinking when we need to. And we need the know-how and strategies to know how to apply our analytic minds to the problem at hand.

For more information on our intelligence and rationality training software click here.

 


References

Baumeister, R. F. & Bushman, B. J. (2010). Social psychology and human nature: International Edition. Belmont, USA: Wadsworth.

Kleiner, Kurt (2009). Why Smart People Do Stupid Things. UofTMagazine

Nordqvist, J. (2013, July 10). “Intelligence Agents More Likely To Make Irrational Decisions Compared To College Students.” Medical News Today.

 

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I am a cognitive scientist with a joint Ph.D in cognitive psychology and neuroscience from the Center of the Neural Basis of Cognition (Carnegie Mellon/Pittsburgh). At IQ Mindware we develop brain training interventions to increase IQ, critical thinking, decision making, creativity and executive functioning.

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