r/BehavioralEconomics

The setup, from Arkes and Blumer (1985): you've bought a $100 ski trip to Michigan. Weeks later you buy a $50 one to Wisconsin, which you think will be more fun. Then you notice they're on the same weekend, and neither ticket can be returned.

Both are already paid for. The only question left is which weekend you'd enjoy more. 33 of 61 students still picked Michigan.

The second experiment used real money. The Ohio University Theater sold season tickets at random prices: $15, $13 or $8. Over the first five plays, full-price buyers used 4.11 tickets each. The discount groups used 3.32 and 3.29. By the last five plays, the difference had gone.

I put these together with Levitt's coin-flip study (20,000+ people; the ones the coin told to make a change were happier six months later) in one page. It also has a quiz on when past costs do count: https://sheets.works/data-viz/sunk-cost-fallacy

Happy to be corrected. The theatre figures are from page 128 of the paper

In a famous legal experiment, experienced German judges were asked to roll a pair of dice before deciding a prison sentence for a shoplifter.

The dice were secretly loaded to only land on 3 or 9.

The judges knew the dice were completely random and irrelevant. Yet those who rolled a 9 gave an average sentence of 8 months, while those who rolled a 3 gave 5 months. Seasoned legal professionals with decades of training, visibly influenced by a toy.

When real estate appraisers were tested, their valuations tracked listing prices almost identically—even while every single agent adamantly denied being influenced.

That is what makes anchoring so dangerous: it doesn't feel like pressure, it feels like your own independent opinion.

Most advice screams: "Always make the first offer to set the anchor."

Yet in high-stakes negotiations, going first frequently backfires—it leaks information about what you know, triggers an immediate regret trap if accepted, and can instantly collapse a deal if the other side has strong alternatives.

Worse, lawmakers are already intervening (like Massachusetts banning employers from asking for salary history entirely, treating a simple question as a price move).

It turns out whether your anchor wins or loses has very little to do with the number itself, and almost everything to do with the "shape" of the ask and how you occupy the room before anyone even speaks.

Put together an animated breakdown exploring the exact papers, the precision effect, and how tandem counter-anchoring works here: https://youtu.be/-5Eiue_jRUo

When you negotiate, do you force yourself to say the first number, or do you prefer waiting to counter?