Tversky & Kahneman (1974) - Anchoring Bias

Question 1

Aim

Answer 1

To investigate whether people’s estimates of a mathematical problem would be influenced by anchoring bias

Question 2

Procedure

Answer 2

In this study, high school students were used as participants. Participants in the “ascending condition” were asked to quickly estimate the value of 1 X 2 X 3 X 4 X 5 X 6 X 7 X 8 in five seconds.

Those in the “descending condition” were asked to quickly estimate the value of 8 X 7 X 6 X 5 X 4 X 3 X 2 X 1.

Since we read from left to right, the researchers assumed that group 1 would use “1” as an anchor and predict a lower value that the group that started with “8” as the anchor. The expectation was that the first number seen would bias the estimate of the value by the participant.

The researchers found that the median for the ascending group was 512; the median for the descending group was 2250. The actual value is 40320.

Question 3

Results

Answer 3

The researchers found that the median for the ascending group was 512; the median for the descending group was 2250. The actual value is 40320.

The group starting with the higher anchor gave significantly higher estimates, supporting the presence of anchoring bias in decision-making.

Question 4

Anchoring Bias

Answer 4

Anchoring bias is a cognitive bias where people rely too heavily on the first piece of information (the “anchor”) they receive when making decisions or estimates, which then influences all subsequent judgments.