The Anchor

The first piece of numerical information we encounter — however arbitrary — acts as an anchor that disproportionately shapes all subsequent estimates and negotiations.

• In Kahneman and Tversky's experiment, a rigged wheel of fortune spinning to 65 or 10 caused participants' subsequent estimates of African countries in the UN to cluster around those numbers.
• Salary negotiations: whoever states a number first anchors the entire discussion — the final outcome will be closer to that opening figure than either party realizes.
• A car dealer's first price is the anchor — even deep discounts feel like victories if they remain near that original inflated figure.