anchoring bias

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onto today’s topic: anchoring bias ⚓️ 

humans have a tendency to latch onto the first piece of information they are presented and use it as a point of reference.

when it comes to shopping for gifts, hunting for houses, or even looking for the best class to take when cross-referencing rate my professor reviews, our budgets always seems to increase, and standards seem to lower. 🤨 

let me paint an example.

the first open math381 section’s professor has a rating of 1.2 stars, but i was hoping to shoot for a 4.00+. the next section’s professor has a rating of 3.7, and suddenly that doesn’t feel so bad. if i saw the 3.7 rating first, i probably wouldn’t have been satisfied and kept looking. since my bar was lowered significantly by the first datapoint, i then used it as a point of reference and ultimately chose the section with a 3.7-rated professor.

this is something we all do subconsciously. 🧠 it’s the same reason why you probably want to hear the bad news before you hear good news — the good news seems way better than it actually is, because your point of reference was anchored to the bad news.

this is called the anchoring bias, and it skews our judgement, preventing us from making well-informed decisions and predictions.

good negotiators take advantage of this human bias. let’s take salary negotiation as a simple example.

as a recruiter, i would want to tell you the lower end of a salary budget. this way, you (the candidate) will be led to believe that this is the “going rate,” and then be okay settling for a lower salary than you may have deserved. 😞 

as a candidate, you want to do your research well and come in with an expectation on the higher end of the salary budget. this way, the recruiter will be settling for something much higher than they initially set out to allot.

when have you been a victim of anchoring bias?

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