Going by the first price when entering a store to assess whether other products of the same type are expensive or cheap is a cognitive bias: the anchor effect, which leads the consumer to make a decision based on biased or incomplete information. “It also occurs within an organization and is usually stronger when the person who establishes the anchor is considered an authority on the subject,” says Pablo Foncillas.
The business school professor explains that when the anchor is a valued member of a company’s board of directors or steering committee, this bias “can have serious consequences for the business” if the person proposes a unwise idea. For this reason, the teacher in general management asserts that the anchoring bias is “a clear limiter” of our ability to think critically and creatively.
