“Propaganda works best when those who are being manipulated are confident they are acting on their own free will.”
– Joseph Goebbels
Daily, we are unconsciously being manipulated by politicians and advertisers alike and we are bombarded with media attempting to persuade us. Let’s examine one the major forces exerting influence on our decision making and how we can minimize the grip it holds on us.
A wise and noble King
Imagine a prospering country in the medieval times. Farm yields are on an all-time high and the population has plenty of food in the granary; They have known peace for the last few years and are living happy lives. You are the king of this medieval civilization. A wise and noble monarch which is beloved by the people. As a king, one must face hard decisions on a daily basis. On this particular day, as you sit on your throne, your main adviser walks up to your throne to discuss policy. He informs you there are two dilemmas on which you must make a decision today that will decide the fate of your citizens.
One of the villages in your kingdom, he tells you, has a population of 600 people and has been struck by the plague. The disease vector has been contained and it will not spread to the rest of your kingdom but it is expected all 600 people in the village will die if nothing is done. Your adviser has spoken with the plague doctors and presents you with two options. The first option involves using a known cure and will surely save 200 people in the village. The second option is an experimental cure which has a 33% chance to save all 600 in the village. If it fails, however, it will save none. The adviser gives you a puzzling look and asks you: ‘What shall we do, my liege?’. Which option do you choose?
Your adviser continues. There is also a second village which requires attention. It’s a similar village with a population of 600 people. The ground surrounding the village is extremely fertile farm ground since it is settled on volcanic ground. By great misfortune, the volcano has recently begun to erupt. If nothing is done, the entire village will be engulfed by lava and all 600 people will be incinerated. Once again, the adviser presents you with two possible options. The first option involves mustering the royal alchemist which has constructed a chemical that might halt the flow of lava. There is a 1 in three chance that the chemical will work and no one in the village will die but there is a 2/3 chance that the chemical will fail and all people in the village will die. The second option is to send your knights and evacuate as many as possible before the lava reaches the town. There is not much time, however, and it means that 400 people in the village will suffer a painful death slowly burning to a crisp. Your adviser frowns. ‘A difficult choice’. Which option do you choose?
The Framing Effect
Think about the options you picked in both scenarios. If you chose the first option in both cases it means you fell victim to the framing effect that the untrustworthy, sly adviser used to manipulate your choices. Don’t worry, this does not mean you are a fool; We all fall into irrationality to this cognitive bias on a daily basis. In fact, the scenarios above are a variation on a well known study on the effect and around 70% of the subjects fell victim to the effect. If you are part of the 30% that was not manipulated, don’t think this does not affect you, it does. It’s an evolutionary trait that we inherited from our time in the wilds.
Note that the two scenarios are identical, they represent the same dilemma – with the same odds – but they are framed differently. The first scenario involving the disease was framed positively; You had the option to save people. The second one was framed negatively, in a way that focused on avoiding losses; the adviser did not mention saving anyone in the second village but merely focused on the death of people. The study showed that people tend to take more risk when a situation is framed in the perspective of losses where people tend to act more risk-averse when confronted with a positively framed situation.
It has to do with our instinctive loss aversion, another biological mechanic that we are programmed with. We are instinctively more heavily impacted by a loss than a gain. If one day we gain 5 dollar and another we lose 5 dollar, you’d expect the happiness gain/loss in both situations to balance out. In fact, losses are felt up to 2.5 times stronger than a gain of similar magnitude. This aversion to losses makes evolutionary sense; If one thinks back to the days that humans were hunter-gatherers, losing a days worth of food could mean certain death while gaining a days worth of food might only mean more comfort in the days ahead. Unfortunately, this instinctive behavior causes irrational behavior and the framing effect is an great example.
The framing effect and loss aversion are all part of a bundle of psychological effects that impair our rationality. An example of another closely related effect can be demonstrated by once again presenting two dilemmas:
Scenario 1. Pick an option.
- Option A. gives you a sure gain of 30 dollar
- Option B gives you an 80% chance to win 45 dollar.
Scenario 2. Pick an option.
- Option A gives you a 25% chance to win 30 dollar
- Option B gives you 20% chance to win 45 dollar.
The certainty effect usually results in people choosing option A in the first scenario, where in the second they are more likely to choose either A or B. Note that both scenarios are – once again – similar; Option B is – mathematically – 20% more valuable in both cases, so rationality would demand we always choose option B. However, we humans prefer certain results over those where we have a probability of gaining nothing. It’s basic nature.
You’ve been framed
So how can these effects be used to steer behavior in the desired direction? Some examples:
- A common hamburger can be advertised as either 75% fat free or 25% fat. Just wander around your local super market and you will find out which option makes the most sense for the advertiser. In fact, people overwhelmingly choose the 75% fat free burger and even dare say it tastes better than the 25% fat burger. In reality, they focus on just a part of the story and are comparing exactly the same product.
- Driving over the speed limit is dangerous and – for the good of society – there should be laws that limit the behavior. The effectiveness of the law depends how the situation is framed; A society can either punish the behavior with a ticket (which triggers loss aversion), or – less effectively – reward the people that obey the laws and drive safely.
- Insurance is the art at using people’s basic instincts to manipulate their behavior. A common advertisement for insurance will focus on avoiding loss. “Imagine that your house burns down! For just 15 dollar a month you are saved from financial ruin!“. It focuses on negative framing. Now imagine insurance was framed the other way around: “We have calculated the risk of your house burning down and it’s very very low. If you forfeit 15 dollar a month from your salary our company can make a profit and save some people where the unlikely risk does manifest.“. Suddenly, insurance doesn’t seem so tempting.
- Politics would be boring without people trying to manipulate your behavior and opinions. Expressions are often re-framed to better suit a political agenda. Famous framing examples include re-framing ‘Global Warming’ to ‘Climate Change’ or re-framing ‘An FBI Investigation’ to ‘a matter’.
- When talking about financial investing, the common man often focuses on potential losses to be incurred, instead of the higher mathematical certainty of potential gains.
So how can we protect ourselves from this rampant manipulation? You can’t, really; The mechanic is so deeply embedded in our biological clockwork that we are forced to obey, like a machine would obey its program. But there are strategies to minimize the effect it has on you. The combined techniques are called hedonic framing and are originally developed by a man named Richard Thaler for improving sales in business. The inverse of the techniques described below can consequently be used to guard against such manipulation.
- Combining gains. The framing effect enhanced the perceived value of multiple gains. It means that if you gain 30 dollar and afterwards gain 70 dollars, your mind perceives it as being more valuable than if you had gained 100 dollar in one go. If you want to make a rational decision involving multiple gains, combine them together and the sum will present a more rational viewpoint than the individual numbers.
- Separating losses. The inverse can be done to enhance losses. Imagine you are buying a 300.000 house and you want to install a 3.000 hot tub in your bathroom. If you frame the costs (losses) summed up as a 303.000 bill the expenses of the hot tub are barely noticeable and do not incur the loss aversion that it should. If you frame the 3.000 dollar for a hot tub ON TOP of the 300.000 house you are already buying it will give even a moderately frugal person a queasy feeling.
- Separate small losses and large gains. Consider once again, two scenarios. In one scenario you gain 25 dollar; In the other, you gain 40 and then lose 15. Although the net result is equal you are unconsciously being manipulated by the certainty effect to frame the first scenario as more positively in your mind. To improve rationality, always attempt to separate small losses that are coupled with large gains as it is not necessarily the net result that matters. Take a business scenario where the net result is 5.000 dollar. It seems great when you frame it like this but what if you incurred huge losses along the way and almost went bankrupt in the process. Perhaps the situation wasn’t all that positive.
- Combine small gains with large losses. A common manipulation strategy that is used in a casino is to provide a so called ‘loss-back’, which gives you a portion of the losses you incurred during a gambling evening back as currency for ‘free bets’. A very positive framing on a terrible scenario. In the case of losses, net result does matter. One would be wise to avoid trying to offset their losses with small gains made along the way.