Decision making under internal uncertainty: the case of multiple-choice tests with different scoring rules.
This paper assesses framing effects on decision making with internal uncertainty, i.e., partial knowledge, by focusing on examinees' behavior in multiple-choice (MC) tests with different scoring rules. In two experiments participants answered a general-knowledge MC test that consisted of 34 solvable and 6 unsolvable items. Experiment 1 studied two scoring rules involving Positive (only gains) and Negative (only losses) scores. Although answering all items was the dominating strategy for both rules, the results revealed a greater tendency to answer under the Negative scoring rule. These results are in line with the predictions derived from Prospect Theory (PT) [Econometrica 47 (1979) 263]. The second experiment studied two scoring rules, which allowed respondents to exhibit partial knowledge. Under the Inclusion-scoring rule the respondents mark all answers that could be correct, and under the Exclusion-scoring rule they exclude all answers that might be incorrect. As predicted by PT, respondents took more risks under the Inclusion rule than under the Exclusion rule. The results illustrate that the basic process that underlies choice behavior under internal uncertainty and especially the effect of framing is similar to the process of choice under external uncertainty and can be described quite accurately by PT.
Bereby-Meyer
Yoella
Y
Department of Education, Ben Gurion University of the Negev, Beer Sheva 84105, Israel. yoella@bgumail.ac.il
Meyer
Joachim
J
Budescu
David V
DV
D002755:Choice Behavior; D003071:Cognition; D003657:Decision Making; D006801:Humans; D008960:Models, Psychological; D011582:Psychological Theory