Advances in Economics, Management and Political Sciences
- The Open Access Proceedings Series for Conferences
Proceedings of the 2023 International Conference on Management Research and Economic Development
Series Vol. 22 , 13 September 2023
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How Anchoring Effect Explains Individual Behaviour and Economic Outcome
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Abstract
The exploration of anchoring effect has developed for a long time in history, and there are many outstanding works. This paper briefly introduces the possible influence of anchoring bias on individual behavior and economic outcomes in behavioral economics, and summarizes the definition, background and significance of this bias. It also uses three applications, including the estimation in the stock market, the retrospective data in the empirical research and the marketing and advertising to prove that the anchoring effect could be important and common both in daily life and economic activities as thinking and decision-making will be affected by this effect. This article finds that the anchoring effect does exist in many economic activities and affects judgments and decisions. This kind of influence sometimes leads to misjudgment and brings negative significance, but sometimes it can be used by people.
Keywords
anchoring bias, behavioral economics, economic activities, judgments, decisions
References
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4. Mussweiler, T., Strack, F., and Pfeiffer, T. (2000) ‘Overcoming the inevitable anchoring effect: Considering the opposite compensates for selective accessibility’, Personality and Social Psychology Bulletin, 26(9), 1142-1150. https://journals.sagepub.com/doi/abs/10.1177/01461672002611010?journalCode=pspc.
5. Cen, L. , Hilary, G. and Wei, J. (2013) ‘The Role of Anchoring Bias in the Equity Market: Evidence from Analysts' Earnings Forecasts and Stock Returns’, The Journal of Financial and Quantitative Analysis , FEBRUARY 2013, Vol. 48, No. 1 (FEBRUARY 2013), pp. 47-76 https://www.jstor.org/stable/43303792.
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Data Availability
The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.
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- Volume Title
- Proceedings of the 2023 International Conference on Management Research and Economic Development
- ISBN (Print)
- 978-1-915371-87-4
- ISBN (Online)
- 978-1-915371-88-1
- Published Date
- 13 September 2023
- Series
- Advances in Economics, Management and Political Sciences
- ISSN (Print)
- 2754-1169
- ISSN (Online)
- 2754-1177
- DOI
- 10.54254/2754-1169/22/20230288
- Copyright
- 13 September 2023
- Open Access
- This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited