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A literature review of the anchoring effect

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  • Furnham, Adrian
  • Boo, Hua Chu
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    Abstract

    The anchoring effect is one of the most robust cognitive heuristics. This paper reviews the literature in this area including various different models, explanations and underlying mechanisms used to explain anchoring effects. The anchoring effect is both robust and has many implications in all decision making processes. This review paper documents the many different domains and tasks in which the effect has been shown. It also considers mood and individual difference (ability, personality, information styles) correlates of anchoring as well as the effect of motivation and knowledge on decisions affected by anchoring. Finally the review looks at the applicants of the anchoring effects in everyday life.

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    File URL: http://www.sciencedirect.com/science/article/B6W5H-516M75F-6/2/afbc3805525e8bba5a20d38e32af59d7
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    Bibliographic Info

    Article provided by Elsevier in its journal Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics).

    Volume (Year): 40 (2011)
    Issue (Month): 1 (February)
    Pages: 35-42

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    Handle: RePEc:eee:soceco:v:40:y:2011:i:1:p:35-42

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    Web page: http://www.elsevier.com/locate/inca/620175

    Related research

    Keywords: Anchoring effects Individual differences Rewards;

    References

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    1. Mussweiler, Thomas & Englich, Birte, 2005. "Subliminal anchoring: Judgmental consequences and underlying mechanisms," Organizational Behavior and Human Decision Processes, Elsevier, vol. 98(2), pages 133-143, November.
    2. Chapman, Gretchen B. & Johnson, Eric J., 1999. "Anchoring, Activation, and the Construction of Values, , , , , ," Organizational Behavior and Human Decision Processes, Elsevier, vol. 79(2), pages 115-153, August.
    3. Shane Frederick, 2005. "Cognitive Reflection and Decision Making," Journal of Economic Perspectives, American Economic Association, vol. 19(4), pages 25-42, Fall.
    4. Mussweiler, Thomas & Strack, Fritz, 2001. "The Semantics of Anchoring," Organizational Behavior and Human Decision Processes, Elsevier, vol. 86(2), pages 234-255, November.
    5. Biswas, Abhijit & Wilson, Elizabeth J. & Licata, Jane W., 1993. "Reference pricing studies in marketing: A synthesis of research results," Journal of Business Research, Elsevier, vol. 27(3), pages 239-256, July.
    6. Oechssler, Jörg & Roider, Andreas & Schmitz, Patrick W., 2009. "Cognitive Abilities and Behavioral Biases," Working Papers 0465, University of Heidelberg, Department of Economics.
    7. Bergman, Oscar & Ellingsen, Tore & Johannesson, Magnus & Svensson, Cicek, 2010. "Anchoring and cognitive ability," Economics Letters, Elsevier, vol. 107(1), pages 66-68, April.
    8. Eroglu, Cuneyt & Croxton, Keely L., 2010. "Biases in judgmental adjustments of statistical forecasts: The role of individual differences," International Journal of Forecasting, Elsevier, vol. 26(1), pages 116-133, January.
    9. Northcraft, Gregory B. & Neale, Margaret A., 1987. "Experts, amateurs, and real estate: An anchoring-and-adjustment perspective on property pricing decisions," Organizational Behavior and Human Decision Processes, Elsevier, vol. 39(1), pages 84-97, February.
    10. Goldstein, Daniel G. & Gigerenzer, Gerd, 2008. "The Recognition Heuristic and the Less-Is-More Effect," Handbook of Experimental Economics Results, Elsevier.
    11. Todd McElroy & Keith Dowd, 2007. "Susceptibility to anchoring effects: How openness-to-experience influences responses to anchoring cues," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 2, pages 48-53, February.
    12. van Exel, N.J.A. & Brouwer, W.B.F. & van den Berg, B. & Koopmanschap, M.A., 2006. "With a little help from an anchor: Discussion and evidence of anchoring effects in contingent valuation," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 35(5), pages 836-853, October.
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    Citations

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    Cited by:
    1. Williams Akande & Bolanle Adetoun & Modupe Adewuyi & Titilola Akande & L. Ntshanga & Balin Dlamini & James Williamson & Nomvul Dladla & Zama Hlongwane & Osad Ibeagu & Erh Osagie, 2012. "The Wisdom of Eve: On Differentiating the Colours of Emotion that May Be Threats to Good Life," Social Indicators Research, Springer, vol. 107(3), pages 531-560, July.
    2. Dean Gatzlaff & Peng Liu, 2013. "List Price Information in the Negotiation of Commercial Real Estate Transactions: Is Silence Golden?," The Journal of Real Estate Finance and Economics, Springer, vol. 47(4), pages 760-786, November.
    3. Meub, Lukas & Proeger, Till, 2014. "Are groups 'less behavioral'? The case of anchoring," Center for European, Governance and Economic Development Research Discussion Papers 188, University of Goettingen, Department of Economics.
    4. Meub, Lukas & Proeger, Till & Bizer, Kilian, 2013. "Anchoring: A valid explanation for biased forecasts when rational predictions are easily accessible and well incentivized?," Center for European, Governance and Economic Development Research Discussion Papers 166, University of Goettingen, Department of Economics.
    5. Caroline C. Brock & Bradford L. Barham, 2013. "‘Milk is Milk’: Organic Dairy Adoption Decisions and Bounded Rationality," Sustainability, MDPI, Open Access Journal, vol. 5(12), pages 5416-5441, December.
    6. Meub, Lukas & Proeger, Till, 2014. "An experimental study on social anchoring," Center for European, Governance and Economic Development Research Discussion Papers 196, University of Goettingen, Department of Economics.

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