Variation in Valence Intensity Within Frames: Testing Predictions of Prospect Theory and Fuzzy-Trace Theory

Abstract

Risk and decision-making are central to human behavior and have been extensively studied across many disciplines. To better understand the factors that influence an individual's risk-related choices, this paper investigates the influence of frame valence intensity. It does so by comparing predictions from two prominent theories of decision-making: Prospect theory (PT) and fuzzy-trace theory (FTT). PT relies on the numerical transformation of subjective value information suggesting that the intensity of the frame should not affect the decision outcome. In contrast, FTT predicts that the level of frame valence should correspond to the intensity of the extracted memory trace and have predictable effects on risky choice. The results demonstrate that risky choice varies across different levels of the frame's valence. For positive frames, increasing valence intensity is associated with decreased risk preference. For negative frames, the relationship is more complex and context-dependent. These findings extend our understanding of framing effects, suggesting that both the direction and intensity of frame valence influence risk preferences. While broadly aligning with FTT predictions regarding gist extraction, our results also indicate that PT could be extended to account for valence intensity effects, potentially bridging these theoretical perspectives.