What Is Anchoring Bias and How Does It Affect Decisions?

Updated February 3, 2023

Unconscious bias can affect decision-making, expectations and a person's perception of events. Noticing examples of bias can help you identify when certain factors are potentially influencing your thinking. Understanding what this type of bias is and how it affects decisions can be important to both professional and personal development.

In this article, we explain what anchoring bias is and when it occurs, show you how to recognize instances of bias with examples and offer tips for overcoming anchor bias.

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What is anchoring bias?

Anchoring bias, or anchor bias, is the common inclination you have to make decisions based on previously accepted information or the first piece of information you learn about a topic. Sometimes, this can lead to more informed decision-making.

Other times, bias skews your abilities to come to logical conclusions, make accurate estimates or select suitable choices. Rather than viewing new information objectively, victims of bias compare any new information they receive to their reference point, which may not always be an accurate representation of a topic.

Related: Different Types of Cognitive Bias (Plus Why It's Important)

Why does this kind of bias occur?

There are a few working theories about why this kind of bias occurs, including:

The anchor-and-adjust hypothesis

The anchor-and-adjust hypothesis claims that when you're uncertain about a decision, you use an initial value as the basis for their future judgments. The downfall of this is that sometimes, your adjustments rely too strongly on the leading value. Adjustments rarely make significant enough departures from their leading point of reference.

Related: How To Manage Expectations at Work (And Why It's Important)


Some studies have reportedly revealed that mood can also affect your tendency to give added significance to anchoring information. Those in sad or foul moods seem to rely more heavily on anchors than those in cheerful moods. These findings contrast with results for other forms of bias because, most often, other types of logical fallacies appear when individuals are happier.

The selective accessibility theory

Another theory says anchor bias occurs because the anchor primes you to notice and believe information that supports their initial perception of a subject. You can be more likely to remember or accept details that reinforce the anchor. This can lead to skewed perceptions and error-prone decision-making.

Effects of anchor bias

Here are some potential effects of anchoring bias:

Poor decision-making

Anchor bias can lead to poor decision-making. When you rely too heavily on a single piece of information, especially if that piece of information doesn't accurately represent a situation, it can lead to uninformed decisions.

Your tendency to accept the first piece of information you hear or learn can skew your perception and cause you to rely disproportionately on the knowledge you already have. When this knowledge is misrepresentative or wrong, it can affect their ability to make sound choices.

Related: Types of Decision-Making Biases (And How To Recognize Bias)

Skewed expectations

Another potential effect of anchor bias is its ability to skew expectations. Anchor bias can happen because of the meaning we attach to certain values.

For example, if asked to guess the multiplied value of a set of numbers with only a few seconds to view them, you might guess that the answer to 15 x 11 x 8 x 4 is higher than the answer to 4 x 8 x 11 x 15, even though the actual total is the same. This is because the starting number in the series can act as an anchor that skews your expectations.

Related: How To Avoid Researcher Bias (With Types and Examples)

Dismissal of new information

Another possible effect of the anchor bias is that you can be more likely to accept information that supports an anchor. If you encounter conflicting information later, you might not give it as much credibility as you did their initial idea.

This can restrict their ability to hear information objectively. For example, if you estimate how much time and energy you need to complete a project and then later discover your estimate was too low, you may feel reticent to adjust your expectations even once you realize those expectations are illogical.

Related: What Is Bias in Statistics? (With Types and Examples)

3 ways to identify anchor bias

Learning to identify instances of anchor bias can help you stay conscious of its effects. Because anchor bias is so pervasive, it affects a lot of the decisions and thoughts you might form. Here are three ways you can identify examples of bias:

1. Relying on a single source of information

You might notice anchor bias occurring when you or someone you know uses only a single point of information to inform their ideas and decisions. In the previously mentioned example of used car prices, the car buyer might rely heavily on the initial car price rather than on the average value of a specific type of car. If a single point or idea is the lone source of your conclusions, you might experience anchor bias.

Related: 26 Common Logical Fallacies To Avoid When Making an Argument

2. Disregarding conflicting facts

One theory of anchor bias asserts that anchors prime you to react in specific ways to new information. If something supports their initial understanding, you might be more willing to believe the new information. If it doesn't support their anchor, you might not give as much credit to the new information.

3. Being reluctant to accept new ideas

Sometimes anchor bias makes it challenging to move away from an assumption or idea, even if new information shows the illogicality of the original idea. A home builder might not accept that material prices are double their estimate because you feel attached to the initial price you imagined for a project. Even if prices rise or some other factor is affecting material supply, you might not want to accept the change to their initial understanding of a situation.

Tips for reducing anchor bias

Here are some tips for reducing anchor bias:

Use multiple sources

One way to reduce anchor bias is to collect more information. Gathering knowledge can help you make informed decisions based on reality rather than an unsubstantial anchoring fact. For example, if you're browsing a furniture store's website, you might notice a couch for sale that originally cost $3,000. The store might say they reduced the couch from its original price, and it now only costs $1,800.

Anchor bias could make you think the new price is a great deal, but further research might reveal similar couches are available from other retailers for an even lower amount. By pausing in your decision-making and waiting until you have more facts, you can make better-informed choices.

Related: How To Calculate Variable Expenses (With Examples)

Evaluate your reasoning

When you arrive at a new conclusion, ask yourself how you came to that conclusion. By analyzing your own thinking, you might identify instances of anchor bias. If you find your reasoning for a thought or decision has a weak foundation, take steps to improve your information and create a stronger argument for your decision or belief.

Related: Positive Feedback: Why It's Important and How To Deliver It

Ask for a second opinion

If you think you've used anchoring bias, ask someone else for their opinion. Try not to share your estimate or thinking, because this can influence anchor bias in the other person. Instead, listen to their reasoning and evaluate it against your own.

Related: What Are Opinion Leaders and Why Is Their Influence Important?

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Examples of anchor bias

Here are some additional examples of anchor bias to help show how it works:


Anchor bias can occur when businesses hire new positions. For example, when reviewing potential candidates, the first resume a hiring manager sees might show the candidate has a master's degree from a well-known university. Even if the job doesn't require a master's degree, the hiring manager might use the first candidate's resume as an anchor for reviewing the others.

Related: Types of Interviewing Bias and How To Minimize It


One of the most common examples of anchor bias occurs when customers view prices. When planning a vacation, a couple might find all-inclusive tickets to Hawaii for $800 each. After further research, they find tickets to Puerto Rico for $400 each, but those tickets only cover airfare. Even though the trip total might end up being the same after they add the additional costs for their hotel room and dining, they choose the Puerto Rico trip to save money.

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