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Psychology

Anchoring Bias in Negotiation and Pricing

Quick fact

In one classic study, experienced real estate agents who were shown a higher listing price for a property made higher estimates of its value—even though they believed the price had no influence on them.

Why this is interesting

Imagine walking into a store and seeing a jacket priced at $500. Suddenly, a $200 jacket seems like a bargain—even if it's worth $50. Why does the first number you see have such a powerful pull?