Anchoring Bias
The tendency to rely too heavily on the first piece of information offered (the “anchor”) when making decisions. Once an anchor is set, subsequent judgments are made by adjusting away from that anchor, often insufficiently.
Examples
- A high initial price makes a subsequent lower price seem like a bargain
- First salary offer in a negotiation heavily influences the final outcome
- A judge’s sentencing decision influenced by an arbitrary number they were exposed to beforehand
Why It Happens
The brain uses the first available number as a reference point. Adjusting from that anchor requires cognitive effort, and people tend to adjust insufficiently.
How to Counteract
- Be aware of anchors and question their relevance
- Generate your own counter-anchor
- Seek multiple reference points before deciding