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Portrait of Erik Wengström. Photo.

Erik Wengström

Director of Doctoral studies, Department of Economics, Professor

Portrait of Erik Wengström. Photo.

Anchoring and subjective belief distributions

Author

  • Håkan Jerker Holm
  • Roel van Veldhuizen
  • Erik Wengström
  • Margaret Samahita

Summary, in English

We investigate how the anchoring effect—a well-established cognitive bias—influences the full distribution of subjective beliefs. While prior research extensively examines the impact of anchoring and other biases on point estimates, their effect on higher moments of the distribution remains unexplored. Through a pre-registered online experiment (N=732), we find that anchoring impacts the mean, variance, and skewness of belief distributions. Notably, the anchoring effect diminishes when eliciting distributions rather than means. Furthermore, presenting anchors prior to eliciting beliefs reduces the variance in belief distributions compared to when elicited without anchors. Our study shows that cognitive biases may have important impacts beyond point estimates.

Department/s

  • Department of Economics
  • Centre for Retail Research at Lund University
  • LU Profile Area: Natural and Artificial Cognition

Publishing year

2024-04-01

Language

English

Pages

1-12

Publication/Series

UCD Centre for Economic Research Working Paper Series

Issue

WP24/07

Document type

Working paper

Topic

  • Economics

Keywords

  • Anchoring
  • Belief Elicitation
  • Heuristics and Biases
  • D73
  • C91
  • K42

Status

Published