Executive Summary

Law 2 fundamentally reframes economics from a discipline of objective value calculation to a science of subjective meaning construction1. It replaces the fiction of the "Rational Economic Man" with the reality of the Framing Agent—a meaning-maker whose perception of value, risk, and rationality is entirely constituted by their active interpretive frame. 

This is not merely behavioral economics adding psychological nuance to classical theory; it is a paradigm shift asserting that traditional economics is not the universal truth, but merely one frame among many. 

I. The Central Revelation 

The foundation of Law 2 is a single, shattering realization: There is no objective value. There is only framed value. 

In Law 1, we established the universal formula for Commitment Value (CV):

$$CV = CV_0 \times V \times A \times (1 + T)$$
5

 
 

However, Law 2 reveals that every component in this formula is frame-dependent6. The true calculation performed by any human agent is:

 
 

$$CV(F_i) = CV_0 \times V(F_i) \times A(F_i) \times (1 + T(F_i)) \times W(F_i)$$
7

 
 

Here, the frame ($F_i$) acts as a lens that filters what information is relevant, shapes how probability is assessed, and determines what aspects of value matter 8. The final term, $W(F_i)$, represents the Weighting Function—a meta-component that determines how much a specific frame matters within an agent’s hierarchy of concerns9.

 
 
 

 

The Parable of the Forest
 

To understand why this matters, consider a single forest viewed through three distinct frames:

The Economic Frame: The forest is timber. $CV_0$ is $10 million, Visibility ($V$) is high because market prices are clear, and Assurance ($A$) is high because demand is stable10.

 
 
The Ecological Frame: The forest is an irreplaceable system. $CV_0$ is infinite, but $V$ is lower because the interdependencies are complex, and $A$ is low due to uncertain long-term climate effects11.

 
 
The Indigenous Frame: The forest is an ancestor. $CV_0$ is Sacred. The value is not in extracting resources but in cultural continuity12.

 
 
There is no "correct" valuation among these three. Each frame constructs a different but internally coherent reality13. The conflict between these groups is not about who has the right data; it is about whose frame gets to define reality14.

 
 
 

 
 

II. The Anatomy of Frames
 

A human's perception of reality is constructed across three specific dimensions15.

 
 

 

1. Domain Frames (The "What" of Value)
 

The domain determines the metric of success:

Economic Domain: Measures value in profit and efficiency. The core question is, "What maximizes wealth?"16161616.

 
 
 
Social Domain: Measures value in relationships and status. The core question is, "What strengthens bonds?"17171717.

 
 
 
Political Domain: Measures value in power and coalition strength. The core question is, "What increases power?"18181818.

 
 
 
Ecological Domain: Measures value in systemic health and sustainability. The core question is, "What maintains life systems?"19191919.

 
 
 
Spiritual Domain: Measures value in meaning and transcendence. The core question is, "What aligns with ultimate truth?"20202020.

 
 
 
 

2. Epistemic Frames (The "How" of Knowing)
 

The epistemic frame determines what an agent trusts as evidence:

Empirical-Rational: Trusts what can be measured and proven. Weakness: Blind to unquantifiable cultural values21212121.

 
 
 
Traditional: Trusts what has endured through time and authority. Weakness: Resistant to innovation22222222.

 
 
 
Emotional: Trusts what "feels" true or resonates intuitively. Weakness: Vulnerable to manipulation23232323.

 
 
 
 

3. Temporal Frames (The "When" of Value)
 

The temporal frame dictates the discount rate applied to the future:

Immediate: Infinite discount rate. Typical of crisis or survival mode24.

 
 
Strategic: 1–5 year horizon. Typical of business planning25.

 
 
Generational: Value spans lifetimes. Typical of infrastructure or family legacy26.

 
 
Eternal: Value exists outside time with no discounting. Typical of sacred commitments27.

 
 
 
 

III. The Constraints of Framed Existence
 

The existence of these divergent frames introduces specific constraints that govern human conflict and cooperation.

 

Constraint 2.1: Frame Incommensurability
 

Some frame differences cannot be bridged; they are fundamentally irreconcilable28.

Consider a negotiation over a sacred site. The Economist offers $10 million. The Indigenous Elder refuses. The Economist, believing everything has a price, raises the offer to $50 million. The Elder is insulted. The Economist is operating in a frame where trade is possible; the Elder is operating in a frame where the land is a non-transferable relative. This is incommensurability—they are not arguing over price; they are arguing over the category of existence 29.

 

Constraint 2.3: The Meta-Conflict Trap
 

The most destructive conflicts are not about competing values within a frame, but about which frame should be sovereign30.

The healthcare debate is a classic example. One camp argues efficiency (Economic Frame), while the other argues human rights (Moral Frame). They talk past each other because the debate is actually about whether healthcare belongs in the economic domain or the moral domain 31.

 

Constraint 2.4: Frame Power Asymmetry
 

Law 2 redefines power. The ultimate power is not the ability to impose costs, but the authority to define which frame is legitimate32.

Frame Oppression occurs when a dominant frame (often Economic) is naturalized as "objective reality," delegitimizing alternative frames as "irrational" or "sentimental" 33.

 
 

IV. Corollaries and Implications
 

 

The Rationality Multiplicity Principle
 

Traditional economics posits that rational agents maximize utility. Law 2 corrects this: Rationality is frame-relative34.

An "irrational" religious sacrifice is perfectly rational within a Spiritual Frame (maximizing divine favor). "Irrational" environmental activism is perfectly rational within an Ecological Frame (preventing systemic collapse)35. We must stop asking "Is this rational?" and ask "Within which frame is this rational?"36.

 

The Frame Ecology Principle
 

Monocultures are fragile; diversity creates resilience. The 2008 Financial Crisis occurred because the Economic Frame dominated all decision-making, creating a blind spot to systemic risk (Ecological Frame) and social consequences (Social Frame) 37. Sustainable systems require Frame Diversity, where economic, social, and ecological frames check and balance one another38.

 
 
 

 

Innovation as Frame-Breaking
 

True innovation is often a framing act. Apple did not just build better hardware; it reframed the computer from a productivity tool (Economic) to a lifestyle statement (Personal/Social)39. Airbnb reframed hospitality from a service industry to community sharing40.

 
 
 

 
 

V. Practical Application: From Knowledge to Wisdom
 

How does one navigate a multi-frame reality?

 

For Negotiators: Frame Translation
 

Bad negotiation imposes one's own frame on the other party (e.g., "This deal is profitable" said to someone concerned with reputation). Effective cooperation requires Frame Translation—presenting proposals in the counterparty's frame language while respecting sovereignty 41.

 
 

 

Technique: "I see you are approaching this from [Their Frame]. Within that frame, your position makes sense. Is there a shared frame where we can both find value?" 42.

 
 
 

For Leaders: Frame-Aware Decision Making
 

Leaders must build Multi-Frame Decision Architecture43. They should require proposals to address multiple dimensions:

 
 

Economic: Does this increase value?
Social: Does this strengthen relationships?
Ecological: Is this sustainable?
Personal: Does this align with our values? 44.

 
 
 

For the Individual: Wisdom as Frame-Agility
 

Wisdom is not knowing the "correct" frame. Wisdom is Frame-Agility—the capacity to consciously switch frames to fit the context.

The Wise Person deploys the Economic frame in a business meeting, switches to the Relational frame with family, and activates the Ecological frame in nature. The Fool uses only one frame everywhere, wondering why nothing works.
 

Conclusion 

Law 2 reminds us that value is not objective; it is frame-constructed. 

This does not mean reality is arbitrary. It means that the ultimate question for any agent is no longer, "What is the right thing to do?" Instead, it is: "Right according to which frame, and is that the most appropriate frame for this context?". 

In the architecture of human cooperation, commitments are the bricks, but frames are the blueprints that determine how those bricks are assembled into the structures of our shared reality.