# Anchoring Bias: Why the First Number Sticks

> Anchoring bias makes the first number you hear shape your estimate. See the wheel of fortune study, examples in pricing and salary, and how to beat it.

Canonical: https://mentarium.io/biases/anchoring-bias.md

Cognitive bias

7 min read By [Nemo](https://mentarium.io/about) Updated October 30, 2026

> **Anchoring bias** is the tendency to rely too heavily on the first piece of information you encounter, usually a number, when making an estimate or decision. Later judgments are adjusted away from that anchor, but not far enough, even when the anchor is obviously irrelevant or random.

- **Category**: Cognitive bias (estimation and judgment)
- **Origin**: Amos Tversky & Daniel Kahneman, 1974
- **Best used for**: Negotiations, pricing, forecasts and any estimate with a number in the room
- **Related**: Framing effect, heuristics, availability heuristic

## What is anchoring bias?

Anchoring bias is when the first number you see pulls your estimate toward it. You know you should adjust, and you do, but you stop too early, so your answer ends up closer to the anchor than it should be.

Anchors can be:

- **Explicit:** a list price, a salary offer, an asking price.
- **Self-generated:** your own first guess, last year’s budget, the price you paid.
- **Irrelevant:** a random number that has nothing to do with the question, which still shifts the answer.

The bias matters most when you are uncertain. If you know exactly what something is worth, an anchor has little to work with. If you don’t, which is most of the time with houses, salaries, timelines and valuations, the first number fills the vacuum.

Where you’ll meet anchors this week:

- **Shopping:** the “was $199” tag, the most expensive bottle on the wine list that makes the second-most expensive look reasonable, the “suggested donation” on a form.
- **Work:** the first estimate in a planning meeting, the budget from last year, the salary range a recruiter mentions first.
- **Money:** the price you paid for a stock, a home’s asking price, the 52-week high on a chart.
- **Everyday estimates:** “Is it more or less than an hour away?” quietly sets the hour as your reference point before you’ve thought about it.

Anchoring is useful to understand partly because it is so cheap to create. Nobody has to lie. They only have to say a number first.

## Where it comes from

The classic demonstration is in Amos Tversky and Daniel Kahneman’s 1974 paper “Judgment under Uncertainty: Heuristics and Biases,” where anchoring and adjustment is one of three [heuristics](https://mentarium.io/biases/heuristics) they described.

### The wheel of fortune study

Participants watched a wheel of fortune, numbered 0 to 100, being spun. The wheel was rigged to stop at either 10 or 65. Participants were first asked whether the percentage of African countries in the United Nations was higher or lower than that number, and then asked for their actual estimate.

The wheel’s number was obviously meaningless. It still moved the answers. People who saw 10 gave a median estimate of 25%. People who saw 65 gave a median of 45%.

### The multiplication study

In the same paper, Tversky and Kahneman asked high school students to estimate, within five seconds, the product of a sequence of numbers. One group saw 8 × 7 × 6 × 5 × 4 × 3 × 2 × 1. The other saw 1 × 2 × 3 × 4 × 5 × 6 × 7 × 8. Same answer. The descending group’s median estimate was 2,250; the ascending group’s was 512. The correct answer is 40,320. Both groups were anchored by the first few steps of the calculation and adjusted far too little, and the group that started with bigger numbers guessed higher.

### What came after

Research since then has found anchoring effects in many settings:

- **Real estate.** Gregory Northcraft and Margaret Neale (1987) gave real estate agents a tour of a house with different listing prices. Their appraisals moved with the listing price, while most said the listing price had not influenced them.
- **Willingness to pay.** Dan Ariely, George Loewenstein and Drazen Prelec (2003) had students write down the last two digits of their social security number before bidding on items. Students with higher digits tended to bid more.
- **Courtrooms.** Birte Englich, Thomas Mussweiler and Fritz Strack (2006) found that legal professionals’ sentencing decisions in a hypothetical case were influenced by anchors, including one produced by rolling dice.

Researchers still debate the mechanism. One explanation is insufficient adjustment: you start at the anchor and move until you hit a plausible answer, then stop at the edge. Another, the selective accessibility model from Mussweiler and Strack, says that considering the anchor makes anchor-consistent information easier to recall. Both probably play a part.

## How to beat anchoring bias

You beat anchoring bias by forming your own estimate from independent reasons before you see anyone else’s number. Six steps:

1. **Make your number first.** Before you read the listing, the offer or the forecast, write your own estimate. Even a rough one gives you a counter-anchor.
2. **Build it from first principles.** Instead of adjusting from a number someone gave you, rebuild the estimate from parts: costs, comparable cases, rates. [First-principles thinking](https://mentarium.io/mental-models/first-principles-thinking) is the cleanest fix because it never starts from the anchor at all.
3. **Bring in the base rate.** What do similar things usually cost or take? [Base rates](https://mentarium.io/mental-models/base-rates) give you an anchor grounded in data instead of in someone’s opening move.
4. **Argue against the anchor.** Ask: “Why might this number be wrong? What would a much higher or much lower answer look like?” Research on “consider the opposite” strategies suggests deliberately generating reasons the anchor is off can reduce its pull.
5. **Prepare negotiation numbers in advance.** Write your target, your opening and your walk-away point before the conversation. When their number lands, compare it with your sheet, not with your gut.
6. **Use ranges, not points.** Estimating a range (low, likely, high) makes you think about the spread of possible values rather than circling one figure.

None of these remove the effect completely. The anchor will still tug. The goal is to make sure there is a second, better-grounded number on the table when it does.

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## 3 real-world examples

These are hypothetical examples showing typical patterns.

### Business

Say a vendor’s first quote for a software project is $120,000. Your team negotiates hard and gets it to $95,000, and everyone feels they won. But nobody had asked what the project should cost. If similar projects usually run $60,000 to $70,000, the negotiation was a success only relative to the anchor. The fix would have been a quick internal estimate, built from scope and comparable projects, written down before the quote arrived.

### Personal life

Say you’re negotiating a job offer and the recruiter asks your current salary. You say $70,000. That number now anchors the offer, regardless of what the new role is worth in the market. A better move: research pay ranges for the role first and answer with what you’re looking for, based on that research. Your number becomes the anchor instead of your old one. (Some US states and cities restrict employers from asking about salary history; check what applies where you live.)

### Investing

Say you bought a stock at $50 and it’s now $30. “I’ll sell when it gets back to $50” is anchoring on your purchase price, a number that means something to you and nothing to the market. The stock doesn’t know what you paid. The relevant question is what the business is worth now, based on what you know today. The same goes for a 52-week high: “it was $80 last year, so $40 is cheap” anchors on a past price, not on value.

## Common mistakes

- **Thinking you’re immune because you noticed the anchor.** Knowing about anchoring reduces the effect only modestly. Awareness without a counter-number rarely helps.
- **Assuming only big anchors matter.** Small, casual numbers (“ballpark, maybe a couple of weeks?”) anchor timelines just as well, and feed the [planning fallacy](https://mentarium.io/biases/planning-fallacy).
- **Anchoring on yourself.** Your first guess, last year’s figure and your purchase price are anchors too, often the hardest to see.
- **Confusing anchoring with framing.** Anchoring is about a reference number pulling an estimate. The [framing effect](https://mentarium.io/biases/framing-effect) is about how the same information, described differently (gain vs loss), changes a choice.
- **Refusing to name a number.** Sometimes avoiding the first move just hands the anchor to the other side.

## Anchoring bias vs framing effect

|  | Anchoring bias | Framing effect |
|---|---|---|
| What changes your judgment | A reference value you saw first | How the same facts are described |
| Typical trigger | A number: price, offer, estimate | Wording: “90% survive” vs “10% die” |
| What it distorts | Estimates and valuations | Choices between options |
| Classic study | Tversky & Kahneman, 1974 (wheel of fortune) | Tversky & Kahneman, 1981 (the “Asian disease” problem) |
| Best fix | Make your own estimate first, from independent reasons | Restate the choice in the opposite frame and see if you’d still choose the same |

The two often work together. A sale tag anchors you on the “original” price and frames the purchase as saving money rather than spending it.

## The Mentarium take

Anchoring is the bias you can use as well as suffer from. Anyone who sets a price, makes an offer or opens a negotiation is placing an anchor, so the question is not only “how do I resist anchors?” but “whose anchor will be in the room?”

Our rule: never enter a number-heavy decision without your own number in writing. That’s it. It takes ten minutes and it changes the whole conversation, because you stop adjusting from their figure and start comparing two figures. Anchoring bias shows up on three of the four Bias Radar lists (Career, Money and Business), which is a good guide to where those ten minutes pay off: salary talks, purchases, budgets, valuations and deadlines.

If you want help setting that number before a big call, the Mentarium Decision Coach at [/coach](https://mentarium.io/coach) runs the Decision Loop inside Claude or ChatGPT; the Frame and Map steps are the right moment to write your number down. The first number still sticks. Make sure it’s yours.

**Fixed by** [First Principles Thinking](https://mentarium.io/mental-models/first-principles-thinking)

## FAQ

### What is an example of anchoring bias?

A jacket shows an original price of $300, crossed out, and a sale price of $150. The $300 anchors your sense of its value, so $150 feels like a bargain, even if you would never have paid $150 for that jacket without the comparison.

### Does anchoring work even when the number is random?

Yes. That is what makes it striking. In Tversky and Kahneman's 1974 study, a number from a rigged wheel of fortune shifted people's estimates of an unrelated question, and later studies have used dice and the last digits of ID numbers with similar effects.

### Should you make the first offer in a negotiation?

Often, yes, if you have done your homework. The first credible number tends to anchor the discussion, so making it lets you set the starting point. If you have little information about the value, letting the other side go first can be safer.

### Can experts be anchored?

Yes. Studies have found anchoring effects among real estate agents estimating home values and among legal professionals deciding sentences. Expertise can reduce the effect in some settings, but it does not reliably remove it.

### How do you avoid anchoring bias?

Form your own estimate before you see anyone else's number, build it from independent reasons such as base rates or costs, and consider why the anchor might be wrong. In negotiations, prepare your target and walk-away numbers in advance and write them down.

## Related models & biases

[Mental model First Principles Thinking First principles thinking is a way of reasoning that breaks a problem down to its most basic facts, the things you know are true without relying on convention or analogy, and then rebuilds a solution from those facts. It replaces "how is this usually done?" with "what is actually required?"](https://mentarium.io/mental-models/first-principles-thinking) [Mental model Base Rates and Base Rate Neglect A base rate is how often something happens in a relevant population, before you look at any specific case. Base rate neglect (the base rate fallacy) is ignoring that number in favor of vivid case details. Kahneman and Tversky showed it with the taxicab problem, where most people overweight a witness and ignore how few cabs are Blue.](https://mentarium.io/mental-models/base-rates) [Cognitive bias Heuristics Heuristics are mental shortcuts: simple rules of thumb that let you make judgments and decisions quickly with limited information, time and attention. They usually work well enough, which is why the brain relies on them, but in some situations they produce predictable errors known as cognitive biases.](https://mentarium.io/biases/heuristics) [Cognitive bias Framing Effect The framing effect is the tendency to make different choices from the same information depending on how it is presented. A gain frame ("90% survive") and a loss frame ("10% die") describe identical outcomes, yet people prefer safe options when thinking about gains and take risks when thinking about losses.](https://mentarium.io/biases/framing-effect) [Cognitive bias Overconfidence Bias Overconfidence bias is the tendency to be more sure of your judgments, abilities or predictions than the evidence justifies. Researchers split it into three forms: overestimating your own performance, overplacing yourself relative to others, and overprecision, being too certain your beliefs are accurate. It is one of the most studied and most costly biases.](https://mentarium.io/biases/overconfidence-bias)

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