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Anchoring on valuations and perceived informativeness

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  • Ioannidis, Konstantinos

Abstract

Anchoring is a cognitive bias whereby individuals’ decisions are influenced by an uninformative number, the anchor. Anchoring bias for valuations of goods has important implications for consumer decisions, but its’ robustness has been questioned by recent studies. We investigate the effect of the perceived informativeness of the anchor on valuations of goods. In an online experiment, we vary the amount of information about the process by which the anchor was determined, and hypothesise that the more information provided, the less scope is left for the anchor to be perceived as non-random/informative, thus mitigating anchoring effects. Our results provide evidence that the perceived informativeness of the anchor does affect anchoring effects. Contrary to our prediction, we find stronger anchoring effects when more information is presented.

Suggested Citation

  • Ioannidis, Konstantinos, 2023. "Anchoring on valuations and perceived informativeness," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 106(C).
    • Handle: RePEc:eee:soceco:v:106:y:2023:i:c:s2214804323000861
    DOI: 10.1016/j.socec.2023.102060
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    Cited by:

    1. Bahník, Štěpán & Yoon, Sangsuk, 2023. "Anchoring effect in business," OSF Preprints 98qdv, Center for Open Science.

    More about this item

    Keywords

    Anchoring; Replication; Experiment;
    All these keywords.

    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior

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