Discovered by Daniel Kahneman and Amos Tversky in 1974.
In an experiment, participants spun a rigged wheel (stopping at 10 or 65) and were then asked about the percentage of African nations in the UN.
Result for 10 group: Average guess 25%
Result for 65 group: Average guess 45%
The random number acted as an "anchor" influencing their estimate.
This is why sellers start with a high price. The first number becomes the reference point for all subsequent negotiations.
Cognitive
Anchoring Effect
The first number you see controls your judgment