Where Anchors Hide

Anchoring manipulates you every day, usually without your awareness:

• Retail pricing — an "original price" of $200 makes a "sale price" of $99 feel like a steal, even if the item was never worth $200
• Salary negotiations — whoever names a number first sets the anchor that all counteroffers orbit around
• Real estate — listing prices anchor buyers' perceptions of fair value regardless of actual market conditions
• Restaurants — placing an expensive item at the top of the menu makes everything else seem reasonable by comparison

Anchoring works even when people are warned about it. Expertise reduces the effect but does not eliminate it.