Ionica (Costache) Munteanu
Alexandru Ioan Cuza University - Faculty of Economics and Business Administration
April 15, 2009
Framing a decision problem can be a very demanding task: firstly, it requires a very good knowledge on the determinants of the problem and then, managerial experience becomes an important issue. In other words, framing refers to the construction of a decision problem which can be analyzed in terms of costs and benefits, but also to managerial art. As a particular implication of decision framing, cost becomes an ambiguous notion as it outdistances more and more from expenditure. When framing implies the implicit representation of resource consumption, costs are measured differently.
In this paper, I focus on the theory of decision framing relating it to various cost constructs and I provide one example of framing from individuals’ experience, where I intend to include some insightful evidence of the managerial art of framing.
Number of Pages in PDF File: 22
Keywords: consistent framing, shadow price, opportunity cost
JEL Classification: C61, M41working papers series
Date posted: April 16, 2009 ; Last revised: April 24, 2009
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