The study of framing effect in electronic bargaining
Authors:Hsin-Hui Lin; Yung-Da Chen; Chin-Shan Wu;Fei-Fei Cheng;
Journal: Chia Da Management Review. Dec. 2007, 27(2): 249-273.
Keywords: Framing effect; electronic bargaining; concession strategy; experimentation
Abstract:
It is often possible that the decision problem can be presented in more than one way. Framing effect refers to the situation in which the
different descriptions of the same logic result in different judgments. Many electronic bargaining system designers assume that human decision
making follows the rational model. In many situations, however, the environments are complex and human cannot react like rational model.
Instead, people rely on a limited number of heuristic principles which often cause biases. This study aims to investigate framing effect of
human judgment in electronic bargaining context. An experiment was conducted to understand the effect of attribute framing and goal framing on
Internet consumers' bargaining performance including bargaining efficiency and sellers' profit. Moreover, the system concession was considered
to play the role of moderator. The results indicated that system concession significantly influences the framing effect on subjects' bargaining
performance. Meanwhile, positive attribute framing and negative goal framing messages are proven to be contributive in increasing sellers'
profit.