Anchoring Effect: Theories and Factors
Athlete Frank Tankerton said that “You can only learn if you open yourself up to different sources of information”. And yet, can the anchoring effect be a cognitive bias that promotes just the opposite in our mind?
Are we fully free when making decisions based on the information available to us? The truth is that there are many factors that influence our decision-making. One of those factors is the anchoring effect, which we’ll discuss in depth here.
What is the anchoring effect?
Have you ever felt that the first information you learned about something seems the most important? How you first perceive certain news will condition the way you see and understand the rest of the information. Obviously, this is something that has great consequences as it easily influences our decision-making process.
The anchoring effect is also known as the focalism effect. This cognitive bias is a psychological phenomenon that affirms the first information we learn about a specific topic. This information is the information that we remember the easiest and it’s the information that most influences subsequent decisions.
We can say that the first information we receive from a source is the information that stays anchored in our memory. It doesn’t mean that we don’t memorize, understand, or interpret the rest of the information. However, it’s true that the first information we learn will stick with us more and will stand out among the rest.
It’s clear that during the decision-making process, this anchoring effect has a lot of significance. This is because, unconsciously, the first information we learn will be more important at the time when we’re making our decisions. Moreover, it’s likely that the rest of the information we learn about a given topic and the rest of the associations we form will all somehow be based on the first information we obtained (initial anchoring).
The origin of the anchoring effect
Let’s take a look at the different hypotheses surrounding how the anchoring effect influences the way we develop our opinions and decisions. This effect influences all areas of our life.
We’re going to use an example so you understand what we’re talking about perfectly. Imagine that you’re going to move into a new apartment. You obviously compare and look at several. However, the first one that you see will serve as a point of reference for the others. It’ll be the point from which you negotiate, bargain, discuss, and ultimately decide. It may be that at your starting point you had a different idea of how things would go. However, there’s no doubt that that initial point of reference greatly influences the way you perceive things.
There are exceptions, of course. For example, a second apartment will be much more impactful if you later discover that the first one is totally out of your price range or something else is wrong with it.
Anchoring and adjustment
People usually try to move away from the anchor to decide. However, they frequently fail to do so. This is difficult to do mentally. This is why the final decision will always use the information from the anchor in one way or another.
When people anchor information, they evaluate and create a response. If that response isn’t adequate, they end up making a different decision. However, they’ll base all of those decisions on anchored information.
Upon receiving the anchor, the person changes their attitude to adapt to the new information they learned. Therefore, future answers are always related to the anchor in some way or another. For example, it may be that starting from this anchor, what once seemed cheap to us starts to seem expensive or vice versa. Let’s think about what we can end up paying for a cell phone today. Wouldn’t we have said that those prices are crazy 20 years ago?
“True genius resides in the capacity for evaluation of uncertain, hazardous, and conflicting information.”
There are factors that help change the way the anchor affects us, both in form and intensity:
- Mood. The anchor can favorably or negatively affect our mood when we receive that information. Depressed people, for example, tend to be more precise when adapting to information. However, other studies claim that they have a tendency to be more passive.
- Experience. A person with a great degree of knowledge and training is less susceptible to this phenomenon. However, no one is completely free from its effect.
- Personality. According to research studies, this effect has less of an influence on extroverted people than on introverted people.
- Cognitive ability. The higher our cognitive ability, the less the effect will impact us. However, as we’ve said, nobody is free from its effect.
“If you can control information, you can control people.”
Hopefully, you’ve learned a little more about the anchoring effect in this article. Do you think it impacts you a lot? We know that nobody is free from it, but it can impact each person differently. However, once we’re aware of the phenomenon and the knowledge is in our hands, it becomes a little easier to decide how much it can influence us and our decisions.It might interest you...