Anchoring: Difference between revisions
imported>Doug Williamson (Correct typo "initial".) |
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''Behavioural skills - cognitive bias''. | 1. ''Behavioural skills - cognitive bias''. | ||
The anchoring effect, or ''anchoring bias'', is a tendency in decision-making to place excessive importance on the first piece of information accessed. | The anchoring effect, or ''anchoring bias'', is a tendency in decision-making to place excessive importance on the first piece of information accessed. | ||
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A common example is the first figure mentioned in a price negotiation. | A common example is the first figure mentioned in a price negotiation. | ||
The reasonableness, or acceptability, of subsequent figures tends - wrongly - to be evaluated by reference to the earlier figure, rather than by objective criteria. | The reasonableness, or acceptability, of subsequent figures tends - wrongly - to be evaluated by reference to the earlier figure, rather than by objective criteria. | ||
2. ''Financial modelling - spreadsheets - construction - cell references.'' | |||
In financial modelling with spreadsheets, anchoring refers to cell references when they're copied around the spreadsheet. | |||
Fully anchored cell references - for example '''$A$1''' in Excel - will stay as $A$1 wherever we copy them within the spreadsheet. | |||
This kind of cell reference is sometimes known as an absolute, fixed or dollarised reference. | |||
Contrasted with a standard relative cell reference - for example '''A1.''' | |||
Relative cell references are the default. | |||
== See also == | == See also == | ||
* [[Absolute]] | |||
* [[Affinity bias]] | * [[Affinity bias]] | ||
* [[Bandwagon bias]] | * [[Bandwagon bias]] | ||
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* [[Cognitive bias]] | * [[Cognitive bias]] | ||
* [[Confirmation bias]] | * [[Confirmation bias]] | ||
* [[Default]] | |||
* [[Default bias]] | * [[Default bias]] | ||
* [[Diversity]] | * [[Diversity]] | ||
* [[Dunning-Kruger effect]] | * [[Dunning-Kruger effect]] | ||
* [[Emotional intelligence]] | * [[Emotional intelligence]] | ||
* [[Excel]] | |||
* [[Executive coaching]] | * [[Executive coaching]] | ||
* [[Financial modelling]] | |||
* [[Hindsight bias]] | * [[Hindsight bias]] | ||
* [[Impostor syndrome]] | * [[Impostor syndrome]] | ||
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* [[Optimism bias]] | * [[Optimism bias]] | ||
* [[Reactance bias]] | * [[Reactance bias]] | ||
* [[Relative]] | |||
* [[Self-investment bias]] | * [[Self-investment bias]] | ||
* [[Self-serving bias]] | * [[Self-serving bias]] | ||
* [[Social bias]] | * [[Social bias]] | ||
* [[Source bias]] | * [[Source bias]] | ||
* [[Spreadsheet]] | |||
* [[Status quo bias]] | * [[Status quo bias]] | ||
* [[Working effectively with others]] | * [[Working effectively with others]] |
Latest revision as of 08:39, 3 February 2022
1. Behavioural skills - cognitive bias.
The anchoring effect, or anchoring bias, is a tendency in decision-making to place excessive importance on the first piece of information accessed.
This initial piece of information is known as the anchor.
A common example is the first figure mentioned in a price negotiation.
The reasonableness, or acceptability, of subsequent figures tends - wrongly - to be evaluated by reference to the earlier figure, rather than by objective criteria.
2. Financial modelling - spreadsheets - construction - cell references.
In financial modelling with spreadsheets, anchoring refers to cell references when they're copied around the spreadsheet.
Fully anchored cell references - for example $A$1 in Excel - will stay as $A$1 wherever we copy them within the spreadsheet.
This kind of cell reference is sometimes known as an absolute, fixed or dollarised reference.
Contrasted with a standard relative cell reference - for example A1.
Relative cell references are the default.
See also
- Absolute
- Affinity bias
- Bandwagon bias
- Behavioural economics
- Behavioural skills
- Choice supporting bias
- Cognitive bias
- Confirmation bias
- Default
- Default bias
- Diversity
- Dunning-Kruger effect
- Emotional intelligence
- Excel
- Executive coaching
- Financial modelling
- Hindsight bias
- Impostor syndrome
- Maslow's hammer
- Objectivity
- Optimism bias
- Reactance bias
- Relative
- Self-investment bias
- Self-serving bias
- Social bias
- Source bias
- Spreadsheet
- Status quo bias
- Working effectively with others