How Humans Rely on What They See First

Various factors influence humans' decisions, and psychology plays a significant role. Before our brain decides on a certain option, it always finds a comparison to ensure the decision is worth it. Although it sounds like the brain is very logical, there are numerous flaws in the brain. When the brain cannot compare the decision to similar options, it tends to look at information with bias and compares it with random options. In other words, even though it is nonsense, the brain does anything to create a reason for a decision. One effect that occurs because of human cognitive bias is the anchoring effect.

The anchoring effect is a cognitive bias where humans rely too much on the first piece of information offered when making decisions. This effect was first found by Daniel Kahneman and Amos Tversky in 1974 from an experiment they conducted. In their experiment, randomly chosen people were asked about the number of African countries that joined the UN. Meanwhile, the people had to look at a spinning wheel with numbers 1 to 100 written until the needle pointed at a certain number. There were no devices with the wheel, and the needle pointed at a random number. The results were shocking. The higher the number people saw on the wheel, the higher the number of African countries the people predicted. Although the people knew the numbers they saw were irrelevant, they guessed the answer based on it. In another experiment, participants expected the food price in a restaurant called "Studio 97" to be higher than in a restaurant called "Studio 17."

This effect can be applied anywhere in real life. For example, when the first page of a menu is costly, customers will try to avoid ordering. However, after they look at the appetizers with relatively low prices, they will look back at the expensive menus and will not care about their prices. This is because the customer is familiar with the high cost. Another example happens when the customer finds a higher cost crossed out on a price tag. Although the seller never sold the product with the crossed-out cost, the customers will expect that the cost was the product's original price and will become familiar with it. After the customers realize that the price beneath the crossed-out cost is lower, they will think the product is a great deal for them. The anchoring effect may organize the situation but is the main cause of absurd decisions.

In 1987, Gregory Northcraft and Margaret Neale found that the anchoring effect is almost impossible to escape from. They experimented with experts and amateurs in real estate, and both groups heavily relied on the first piece of information they received. The anchoring effect occurs because it is a human tendency that can not be avoided. However, there are ways to use this effect efficiently. In negotiations, be the first to call out the option that gives the best benefits. After that, the first option will influence most of the negotiation, and the final decision will be beneficial. Therefore, the anchoring effect is the source of misconduct, but it can be used effectively with the proper understanding of the effect.