← Cognitive Biases (Built-in Thinking Errors)

Anchoring Bias

category

Anchoring bias is the cognitive tendency to rely disproportionately on the first piece of numerical or categorical information encountered when making subsequent estimates or judgments — the initial 'anchor' pulling all subsequent assessments toward it regardless of its relevance or accuracy. Classic demonstrations show that people's salary negotiation outcomes, purchase price evaluations, sentencing recommendations, and medical diagnoses are all systematically distorted by arbitrary initial numbers introduced before deliberation.

Role

Anchoring is one of the most practically exploited cognitive biases in commercial and negotiation contexts — and understanding it is directly economically valuable. Car dealerships anchor with sticker price before discounting; real estate agents anchor with listing price before negotiation; salary offers anchor with a first number that the candidate then negotiates from rather than toward their own independent assessment of fair value. The majority of people who have never studied anchoring enter every price negotiation, salary discussion, and financial evaluation with their judgment already distorted by strategically placed initial numbers — and experience the resulting outcomes as the product of fair deliberation rather than anchoring exploitation.

Subtopics

Overconfidence Bias Overconfidence bias is the systematic tendency to overestimate the accuracy of one's own knowledge, …

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