Anchoring Bias
Anchoring bias is 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 — but the adjustments are usually insufficient.
Examples
- Negotiations: The first number put on the table disproportionately influences the final outcome. This is why experienced negotiators care so much about who sets the opening price.
- Investing: If you bought a stock at $100 and it drops to $60, you're anchored to $100 as "what it's worth." The current price might actually be generous relative to fundamentals.
- Estimation: In experiments, people who first see a high random number estimate higher values for unrelated questions than people who see a low random number.
- Vendor evaluation: A colleague's vendor comparison in link not tracked was a textbook case — she anchored on competitor pricing instead of reasoning from actual requirements.
Anchoring connects to Probabilistic Thinking because accurate probability estimates require you to start from Base Rates, not from whatever number happens to be salient. It's also why Inversion is valuable — inverting the problem gives you a second anchor point to triangulate from.
See also: Cognitive Biases for the broader landscape of systematic reasoning errors.