Anchoring and adjustment heuristic

Anchoring and adjustment heuristic is a mental shortcut used in decision making. It involves focusing on an initial value or piece of information, called an anchor, and then adjusting away from the anchor to come up with a final value. This heuristic helps us make decisions in uncertain situations where there is no clear path or solution. It is a useful tool for seeking out reasonable estimates, but can also lead to errors because we often fail to adjust from the anchor sufficiently. For example, a job seeker may anchor on their current salary in negotiations with a potential employer; this could lead to undervaluing their potential worth during negotiations.