Anchor Point Theory

Anchor Point Theory suggests that people rely on specific reference points, or "anchors," to make judgments and decisions. These anchors are often initial information, past experiences, or perceived norms that influence how we interpret new data. For example, in negotiations, the first offer made can serve as an anchor, shaping perceptions of fairness. Recognizing these anchors helps us understand biases and improve decision-making by critically assessing the reference points we rely on. Overall, the theory highlights the importance of context and initial impressions in shaping our perceptions and choices.