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InsightCard 13 of 21

Anchoring Bias

First information heavily influences subsequent judgments.

Explanation

The first number or piece of information you encounter acts like an anchor that pulls all your future estimates toward it. Even when that first number is completely random or irrelevant, it affects your thinking. This bias is so strong that it works even when you're aware of it and trying to resist it.

Real-World Example

Asked if Gandhi died before or after age 144, then estimate his actual death age—people guess higher than if asked about age 32. Salary negotiations: whoever states first number anchors the entire discussion. Real estate: listing price anchors buyer's perception of value, even for identical houses.

How to Apply

When negotiating: make the first reasonable offer to set favorable anchor. When being negotiated with: explicitly reject their anchor ('That's not in the right ballpark') and counter with your own. When estimating: start from multiple reference points, not just one. Question: Where did this initial number come from?

Related Topics

biasnegotiationjudgment

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