Effects of situation familiarity and financial incentives on use of the anchoring and adjustment heuristic for probability assessment

William F. Wright, Urton Anderson

Research output: Contribution to journalArticlepeer-review

109 Scopus citations

Abstract

Three experiments tested (1) whether anchoring (and insufficient adjustment) will occur during generation of subjective probabilities and (2) whether situation familiarity and performance-contingent incentives will reduce any anchoring effect. A total of 336 business school students either chose between two alternatives based on a preliminary judgment of relatively unlikely (low anchor) or likely (high anchor) event probabilities before generating final probability assessments or were in a no-choice control condition. The results indicate a strong anchoring effect. The anchoring effect is so dominant that increasing situational familiarity did not result in decreased anchoring. Monetary/recognition incentives for accurate judgments did, however, result in significantly less anchoring. Implications are suggested for research on judgment processes and the concept of professional judgment expertise.

Original languageEnglish
Pages (from-to)68-82
Number of pages15
JournalOrganizational Behavior and Human Decision Processes
Volume44
Issue number1
DOIs
StatePublished - Aug 1989

ASJC Scopus subject areas

  • Applied Psychology
  • Organizational Behavior and Human Resource Management

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