Framing effects in justice perceptions: Prospect theory and counterfactuals

The majority of organizational justice research is underscored by the assumption that individuals form justice perceptions based on deliberate processing of information, using various justice judgment criteria. Taking an alternative view, this research examined how individuals form fairness perceptions in less deliberate ways—in particular, based on the way in which a decision outcome is framed. Drawing on prospect theory (Kahneman & Tversky, 1979), we argued that decision outcomes that are framed in line with prospect theory’s predictions would attenuate counterfactual processing because those outcomes are consistent with individuals’ biased preferences. Drawing on fairness theory (Folger & Cropanzano, 1998, 2001), we argued that lower levels of counterfactual thinking increases the tendency for a decision to seem fair; therefore, framing a decision in a way that is consistent with a pre-existing bias could increase the extent to which it is perceived as fair. We found support for our hypotheses in two experiments.