How Anchoring Bias Makes You Dumb

Our subconscious mind will use almost anything to "help" us think and make decisions. Be alert or be led astray..

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Want to make better decisions? Be alert to the troublesome anchoring bias that lives in your brain. We all have it. It comes with the standard factory-issue human package. It’s important to understand it because our subconscious minds are prone to dropping anchor anywhere with surprising consequences. In my book, Think: Why You Should Question Everything, I detail this bias and other cognitive challenges. Here’s the least you need to know.

The subconscious mind has a strong tendency or compulsion to refer to a recently encountered reference point, piece of evidence, or other input when trying to figure out something or make a decision. It does this not to sabotage us but to help. Unfortunately, it doesn’t always work out well because that anchor point might be irrelevant or just plain wrong. Forget the worm — the early bird takes your brain.

This can be a powerful influence on our thought process, but most people know nothing about it. What makes it so potentially maddening and problematic is that the initial anchor point may be totally unrelated to the topic in question.

For example, if you see or hear something about a $300,000 Ferrari and then encounter a $10 candy bar, you might be less likely to recognize that the candy bar is overpriced. Crazy as it seems, if I were to simply say or show you the numbers 500,000 and 800,000—with no context—and then a few minutes later asked you to estimate how many books there are in your local library, you likely would offer a higher number than if I had first exposed you to the numbers five and ten.

It seems absurd, right? Welcome to your subconscious mind. When pressed for answers, it will use whatever it has to work with, relevance be damned. Many studies have confirmed this phenomenon.

One important experiment by Amos Tversky and Nobel Prize winner Daniel Kahneman gives us a clear demonstration of the anchoring effect. The researchers asked people to estimate the percentage of African countries in the United Nations after spinning a roulette wheel. Unknown to the participants, the wheel was rigged to stop on either the number 10 or the number 65. The roulette wheel numbers had no connection to the correct percentage of African nations. But it made a connection anyway in the subconscious minds of those who spun the wheel.

On average, the people who landed on “10” estimated 25 percent of the United Nations members were African nations. Those who spun the wheel and landed on “65” estimated a higher average: 45 percent. That’s a significant difference, and it was generated by nothing more than spinning a wheel and landing on a disconnected but influential number.

In another experiment, Tversky and Kahneman gave the following math problem to a group of high school students and told them to give an answer within five seconds: 8 X 7 X 6 X 5 X 4 X 3 X 2 X 1. That’s not enough time to solve the problem, so the students had to make a guess after completing only the first few computations. The median answer for this group was 2,250.

Another group of students was given the same problem but in reverse order: 1 X 2 X 3 X 4 X 5 X 6 X 7 X 8. Their median estimate was 512. (The correct answer for the problem, either way, is 40,320.) There is a huge gap between 2,240 and 512. The dramatic contrast was the result of students doing calculations with smaller or larger numbers first before making an estimate.

You can’t hide from the anchoring bias. Don’t be so silly as to believe you are somehow special and not susceptible to it. It’s always there, in your everyday life, constantly trying to help you come up with answers and make decisions. It may mean well, but this bias can and often will lead you astray. High intelligence and advanced education are not enough to protect you from the blunders it may cause.

This is a part of being human, so consider yourself warned. When we neglect to pause, doubt, think, and reconsider our reasoning on important matters, we risk becoming the victims of our own thoughts. Use your brain to check your brain.