What Is the Anchoring Bias? Definition, Examples and How to Avoid It

A jacket in a shop window is marked down from $400 to $200, and $200 suddenly feels like a bargain. Later you find out the jacket was never really worth more than $150. The $400 did its work before you had a chance to evaluate anything.

That quiet pull is the anchoring bias, one of the most reliably reproduced findings in judgement and decision-making, and one that shapes prices, salaries, estimates and even medical judgements.

What is the anchoring bias?

The anchoring bias is the tendency to rely too heavily on the first piece of information we encounter, the anchor, when making a later estimate or decision. We adjust away from the anchor, but usually not far enough, so the final judgement stays closer to it than the facts justify.

Where the research comes from

The effect was described by Amos Tversky and Daniel Kahneman in their 1974 paper on judgement under uncertainty. In one well-known set of experiments, participants spun a wheel that was rigged to land on either 10 or 65, then estimated the percentage of African countries in the United Nations. Those who saw the higher number gave noticeably higher estimates, even though the wheel was obviously random.

Later studies went further. In a widely cited experiment, people were asked to write down the last two digits of their social security number and then bid on items such as wine and chocolate. Those with higher digits bid significantly more. The number was irrelevant, and the effect still held.

Why does anchoring happen?

Adjustment is lazy

We start from the anchor and move toward a plausible answer, but we tend to stop as soon as the answer feels acceptable, which is usually before we’ve travelled far enough.

The anchor primes related information

Seeing a high number makes information that supports a high value more available to the mind, and low numbers do the opposite. This overlaps with the availability heuristic: what comes to mind first shapes what we think is typical.

We treat first information as informative

Even when we suspect an anchor is arbitrary, the mind tends to give it a little weight, assuming someone must have had a reason for the number.

Everyday examples

Anchors often travel with other shortcuts, such as the halo effect, where one good impression colours everything after it, and the mere-exposure effect, where familiarity quietly breeds preference.

Pricing

A “was $400, now $200” tag, a high-priced item beside the one you’re meant to buy, or a restaurant menu that opens with an expensive dish all use anchors to make the next price feel reasonable.

Salary negotiation

Studies on negotiation find that the first offer on the table often acts as a reference point for everything that follows, which is why who names the first number can matter so much.

Estimates and forecasts

A project’s first time estimate, even a rough guess, tends to stick, and later estimates cluster around it regardless of new information.

Medical and professional judgement

Experts are not immune. A first impression of a case or a first suspected diagnosis can pull later reasoning toward it, much like confirmation bias reinforcing the first idea.

Everyday decisions

A friend’s first guess at how long a trip will take, a quoted renovation price, a rent figure from the first apartment you view: each becomes a yardstick for everything that comes next.

How to reduce the pull of anchors

1. Form your own estimate first

Before seeing a price, an offer or someone’s guess, decide what you think the answer is. A prior estimate gives you something to compare against, rather than letting the first number define the range.

2. Consider the opposite

Deliberately ask why the true value might be much higher or much lower than the anchor. Research on debiasing finds that generating reasons the anchor could be wrong reduces its effect.

3. Look for several independent reference points

Compare multiple prices, offers or estimates from different sources rather than evaluating a single number in isolation.

4. Make the first offer yourself in a negotiation, when you can

Because the first number often sets the range, anchoring first, with a reasoned figure, can shift the discussion your way.

5. Slow down on decisions that matter

Anchoring thrives on speed. Taking a night, or at least a few minutes, before agreeing to a price or a plan gives adjustment time to work.

6. Separate the number from the story around it

Ask: If I had never seen that first figure, what would I think this is worth? The question strips away the anchor’s framing.

A worked example

Sam is shown a flat with an asking price of £450,000 and starts to feel that £420,000 would be a good deal.

• Anchoring in action: the asking price has quietly set Sam’s sense of what the flat should cost.
• Correction: Sam first looks at recent sales of three similar flats nearby, all around £390,000.
• Result: with an independent reference point, Sam makes an offer based on comparable sales rather than the asking figure.

Common mistakes

• Assuming an anchor only works if you believe it. It works even when you know it’s arbitrary.
• Evaluating a price in isolation. Without other reference points, the first one dominates.
• Believing experts are immune. Professionals anchor too, especially on first impressions.
• Letting the other side name the first number by default. Preparing your own range first protects you.
• Treating the bias as only a shopping problem. It shapes time estimates, salaries and judgements about people.

Frequently asked questions

What is a simple example of the anchoring bias?

Seeing a jacket marked down from $400 to $200 and feeling that $200 is a bargain, even if the jacket was never worth $400.

Does anchoring work even if you know about it?

Often yes. Studies find that people who are aware of the effect still show it, though deliberate strategies can reduce it.

How is anchoring different from confirmation bias?

Anchoring is about a starting number pulling later estimates toward it. Confirmation bias is about favouring information that agrees with what we already believe.

How does anchoring affect negotiations?

The first offer often becomes a reference point, so the final figure tends to land closer to it than it otherwise would.

How can I avoid anchoring when shopping?

Decide what you think something is worth before you see the price, and compare several independent prices.

Is the anchoring bias always bad?

Not always, since quick reference points save effort. It becomes a problem when the anchor is arbitrary and the stakes are real.

The bottom line

The first number you hear quietly pulls every later judgement toward it, even when you know it shouldn’t. Form your own estimate before seeing a figure, consider why the real value might be far from the anchor and compare several independent reference points before you decide.