Noise Increases Anchoring Effects

We introduce a theoretical framework distinguishing between anchoring effects, anchoring bias, and judgmental noise: Anchoring effects require anchoring bias, but noise modulates their size. We tested this framework by manipulating stimulus magnitudes. As magnitudes increase, psychophysical noise due to scalar variability widens the perceived range of plausible values for the stimulus. This increased noise, in turn, increases the influence of anchoring bias on judgments. In 11 preregistered experiments ( N = 3,552 adults), anchoring effects increased with stimulus magnitude for point estimates of familiar and novel stimuli (e.g., reservation prices for hotels and donuts, counts in dot arrays). Comparisons of relevant and irrelevant anchors showed that noise itself did not produce anchoring effects. Noise amplified anchoring bias. Our findings identify a stimulus feature predicting the size and replicability of anchoring effects—stimulus magnitude. More broadly, we show how to use psychophysical noise to test relationships between bias and noise in judgment under uncertainty.

Sequential delay and probability discounting tasks in mice reveal anchoring effects partially attributable to decision noise

Delay discounting and probability discounting decision making tasks in rodent models have high translational potential. However, it is unclear whether the discounted value of the large reward option is the main contributor to variability in animals' choices in either task, which may limit translatability to human discounting data. Male and female mice underwent sessions of delay and probability discounting in sequence to assess how choice behavior adapts over experience with each task. To control for "anchoring" (persistent choices based on the initial delay or probability), mice experienced "Worsening" schedules where the large reward was offered under initially favorable delay or probability conditions that became less favorable during testing, followed by "Improving" schedules where the large reward was offered under initially unfavorable conditions that improved over a session. During delay discounting, both male and female mice showed elimination of anchoring effects over training. In probability discounting, both sexes of mice continued to show some anchoring even after months of training. One possibility is that noisy action selection could contribute to these anchoring effects, rather than persistent fluctuations in value discounting. We fit choice behavior in individual animals using models that included both a value-based discounting parameter and a decision noise parameter that captured variability in choices deviating from value maximization. Changes in anchoring behavior over time were tracked by changes in our decision noise parameter, not the value parameter. Thus, changes in discounting behavior in mice can result from changes in exploration of the environment rather than changes in reward valuation.

Anchoring effect

An assimilation of an estimate towards a previously considered standard is defined as judgmental anchoring. Anchoring constitutes a ubiquitous phenomenon that occurs in a variety of laboratory and real-world settings. Anchoring effects are remarkably robust. They may occur even if the anchor values are clearly uninformative or implausibly extreme, are sometimes independent of participants’ motivation and expertise, and may persist over long periods of time. Different underlying mechanisms may contribute to the generation of anchoring effects. Specifically, anchoring may result from insufficient adjustment, from the use of conversational inferences, from selective accessibility of information consistent with an anchor, or from the distortion of a response scale.

Anchoring and Judgment Bias: Disregarding Under Uncertainty

The current investigation examined the nature of the cognitive processes that underlie decision-making behavior. The focus of this project centered on the effects of utilizing heuristics that pertain to the availability of information stored in memory. Anchoring effects demonstrate that people will use any available information sampled from memory as a reference for making judgments of frequency. The specific aim of the experiment was to examine whether people exhibit patterns of behavior consistent with anchoring effects, revealed by corrupted subjective judgments, despite explicit notice of instruction to disregard the experimenter-supplied information (the anchor). Subjects failed to demonstrate an ability to disregard a relatively high anchor even when the instruction to do so was explicit. However, in contrast, subjects demonstrated an ability to disregard a relatively low anchor. More broadly, subjects instructed to disregard demonstrated a reduced effect of anchoring. Implications are considered within the context of the availability heuristic and the directly related effects of anchoring. The results may be interpreted within the framework of a dual-process model, two-system view that distinguishes intuition from reasoning. The present findings fit with well-supported theoretical explanations of anchoring effects, such as selective accessibility and numerical priming.

When time pressure counters the zero price effect

Purpose The freemium pricing model is dominant in digital products such as mobile applications. While limited evaluation of a product such as when a consumer is under time pressure, has been found to increase consumer preference for the free version (“the zero price effect”), this paper aims to explore moderators that attenuate or reverse that effect. Design/methodology/approach Three experiments test the role of anchoring effects induced by time pressure in moderating the zero price effect. Findings The studies offer evidence that anchoring effects induced by time pressure can be directed to reduce preference for free versions of products. In addition, these effects are mediated by the perceived performance risk of a product and an upper boundary condition for monetary price level is found. Research limitations/implications This research demonstrates exceptions to time pressure’s role in intensifying the zero price effect. Future research could focus on additional moderators of the effect such as the need for certainty and examine time pressure’s effect on in-app purchases. Practical implications These findings can be directly applied by marketers of digital products using a freemium pricing model who wants to use time pressure to create urgency with customers without pushing them toward the free version of a product. Originality/value This paper finds exceptions to the zero price effect where consumers exhibit a stronger preference for the paid (vs free) version of a product when under time pressure.