Cognitive biases: why a smart brain makes the same mistakes every time
Anchoring bias: how the first number bends every guess
A seller names a price you know is far too high, and you laugh at it. Then your own offer still drifts toward it. Even a number everyone knows is silly can do that.
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1
Miva wants the yellow car, and she has checked the prices. Online, cars like it sell for about $9,000. That is her number.
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2
Rono speaks first. "This one is $15,000." Miva laughs. She knows $15,000 is far too much for this car.
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3
Then she offers $11,000, not $9,000. The number she laughed at has pulled her guess toward it, the way an anchor holds a boat near it. This pull is called anchoring.
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4
It works even when everyone knows the number is silly. People asked whether Gandhi died before or after age 140 then guessed, on average, that he died at 67. People asked about age 9 guessed 50.
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5
They agree on $11,500, and Miva will sign tomorrow. She is pleased: $3,500 off Rono's price! Measured from her own number, she has agreed to pay $2,500 more.
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Quick check
A shop shows a jacket: "Was $400, now $150." The jacket is worth about $80. Why can $150 still feel cheap?
Show the answer
The $400 is an anchor. It pulls your sense of the price up, so $150 looks low next to it, even if you never believed the $400.
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Go further
Anchors are everywhere a price is said first.