Definition:

1. The human tendency to rely heavily on an initial piece of information when making decisions

References:

1. Tversky and Kahneman experiment (1974) - Wheel of Fortune as an anchor for questions about UN African Nations.

Insights:

1. Anchoring can influence our perception of fair pricing.

Definition:

1. The ease of bringing to mind instances and the effect on our judgement of frequency.

Insights:

1. Easy to recall and vivid events have a disproportionate impact on our judgement. We overemphasise examples or events that come easiest to our mind.

Definition:

1. When we behave inconsistently with our beliefs we experience a negative state called cognitive dissonance.

Insights:

1. We often feel the need to justify our actions, even when they conflict with our knowledge and beliefs.
2. We can experience dissonance when our actions are not reflected by rewards or coercion. Can often justify our actions, to ourselves or others, to reduce dissonance.

References:

1. Leon Festinger: 1959 experiment - asking participants to complete a task in which they are paid $0, $1, or $20. The study showed that those paid $1 rated the experience as more enjoyable and felt a sense of importance, even than those paid $20. They created a story that justified to themselves why they were happy to do the tasks, even when they knew it was for a relatively small amount.

Definition:

1. A form of learning where is reinforcer (food, praise, money etc.) is given after a performing a very specific act.

Definition:

1. The belief that you are a better judge than others, and misfortune is less likely to happen to you than others.

Examples:

1. Creativity and brainstorming in groups.

Insights:

1. Data suggests that people working alone have more creative output than working in groups because in groups we can let other people do the work.