The Anchoring Effect: How the First Number You Hear Controls Your Thinking

Before you answer the next question, spin an imaginary wheel of fortune. It stops on 65. Now: what percentage of African countries are members of the United Nations?

In Amos Tversky and Daniel Kahneman's original 1974 study, participants who watched a wheel land on a high number gave higher estimates for this kind of question than those who watched it land on a low number. The wheel was irrelevant. The participants knew it was irrelevant. And yet the number it landed on shaped their estimates anyway.

This is anchoring, and it is one of the most robust and widely replicated findings in behavioural psychology. When you are asked to make a numerical judgment, an estimate, a guess, or a decision involving quantity, the first number you encounter serves as a cognitive anchor. Your final answer adjusts from that anchor, but rarely adjusts enough.

The effect operates in remarkably diverse contexts. In salary negotiations, whoever states a number first anchors the conversation. In retail, the original price marked as crossed out serves as an anchor that makes the sale price feel like a bargain even when the original price was inflated. In legal settings, prosecutors who request higher sentences tend to get higher sentences — even from experienced judges who presumably know about anchoring.

What is particularly unsettling is that the anchoring number does not have to be related to the subject at hand, and knowing about anchoring does not fully protect you from it. Even people who are warned about anchoring and instructed to correct for it still show the effect, just slightly reduced.

Tversky and Kahneman proposed two mechanisms. The first is insufficient adjustment: we start from the anchor and move in the right direction but stop too soon. The second is selective accessibility: the anchor makes certain associated information more mentally available, biasing the judgment in the anchor's direction.

In practical terms, this means that in any negotiation or purchasing decision, you benefit from doing your own research before you encounter any anchor, being aware of anchors being set deliberately, and making a conscious effort to adjust further than your instinct suggests. Generating your own estimate before receiving any external number is the most effective partial defence.