What shapes the probability weighting function? Influence of affect, numeric competencies, and information formats

Research suggests that people are less sensitive to variations in probability in affect-rich compared with affect-poor risky choices. This effect is modeled by a more curved probability weighting function (PWF). We investigated the role of different numeric competencies and the effectiveness of several intervention strategies to decrease this affect-laden probability distortion. In two experiments, we manipulated the affect-richness of a risky prospect. In Experiment 1 (N = 467), we measured numeracy and symbolic-number mapping (i.e., the ability to accurately map numbers onto their underlying magnitudes). The affect-based manipulations showed the expected effects only in participants with more accurate symbolic-number mapping, who also reported more differentiated emotional reactions to the various probabilities and displayed more linear PWFs. Instructions to focus on the probability information decreased probability distortion and revealed differences in the use of probability information on the basis of symbolic-number mapping ability. In Experiment 2 (N = 417), we manipulated the format in which the probability information was presented: using visual aids versus no visual aids and a positive frame (e.g., one person wins) versus combined frame (e.g., one person wins and 99 persons do not win). The affect-based manipulations had no effect but both the visual aids and combined frame decreased probability distortion. Whereas affect-richness manipulations require further research, results suggest that probability weighting is at least partially driven by the inability to translate numerical information into meaningful and well-calibrated affective intuitions. Visual aids and simple framing manipulations designed to calibrate these intuitions can help decision makers extract the gist and increase sensitivity to probabilities.