The Anchoring-and-Adjustment Heuristic: Why the Adjustments Are Insufficient
Abstract (Via Booth)
One way to make judgments under uncertainty is to anchor on information that comes to mind and adjust until a plausible estimate is reached. This anchoring-and adjustment heuristic is assumed to underlie many intuitive
judgments, and insufficient adjustment is commonly invoked to explain judgmental biases. However, despite extensive research on anchoring effects, evidence for adjustment-based anchoring biases has only recently been provided, and the causes of insufficient adjustment remain unclear. This research was designed to identify the origins of insufficient adjustment. The results of two sets of experiments indicate that adjustments from self-generated anchor values tend to be insufficient because they terminate once a plausible value is reached (Studies 1a and 1b) unless one is able and willing to search for a more accurate estimate (Studies 2a–2c).
Favorite excerpt (Via Booth)
This research was first and foremost designed to explain why the use of the anchoring-and-adjustment heuristic yields reliable anchoring effects—that is, why adjustments tend to be insufficient. Testing an idea first advanced by Quattrone et al. (1981), we obtained evidence that people adjust insufficiently from an initial anchor value because they stop adjusting once their adjustments fall within an implicit range of plausible values (see also Epley, Keysar, Van Boven, & Gilovich, 2004). People’s estimates therefore tend to lie near the anchor side of this implicit range, but, on average, the true value is likely to lie closer to the middle of the range. We also obtained evidence that adjustment is effortful, and so anything that increases a person’s willingness or ability to seek more accurate estimates tends to reduce the magnitude of adjustment-based anchoring biases.