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Tversky and Kahneman [75] suggest that the anchoring effect is the product of anchoring and adjustment heuristics whereby estimates are made starting from an anchor value which is then adjusted in until the individual has reached an answer. Kahneman suggests that anchoring occurs from derivations from anchor-consistent knowledge.
The availability heuristic (also known as the availability bias) is the tendency to overestimate the likelihood of events with greater "availability" in memory, which can be influenced by how recent the memories are or how unusual or emotionally charged they may be. [20] The availability heuristic includes or involves the following:
Heuristics are simple for the brain to compute but sometimes introduce "severe and systematic errors." [6] For example, the representativeness heuristic is defined as "The tendency to judge the frequency or likelihood" of an occurrence by the extent of which the event "resembles the typical case." [13]
Anchoring and adjustment is a heuristic used in many situations where people estimate a number. [78] According to Tversky and Kahneman's original description, it involves starting from a readily available number—the "anchor"—and shifting either up or down to reach an answer that seems plausible. [ 78 ]
The availability heuristic, also known as availability bias, is a mental shortcut that relies on immediate examples that come to a given person's mind when evaluating a specific topic, concept, method, or decision.
Anchoring bias, the tendency to produce an estimate near a cue amount that may or may not have been intentionally offered. For example, producing a quote based on a manager's preferences, or, negotiating a house purchase price from the starting amount suggested by a real estate agent rather than an objective assessment of value.
The availability heuristic suggests that the likelihood of events is estimated based on how many examples of such events come to mind. Thus the familiarity heuristic shows how "bias of availability is related to the ease of recall." [1] Tversky and Kahneman created an experiment in order to test this heuristic. They devised four lists of 39 names.
Two heuristics identified by Tversky and Kahneman were of immediate importance in the development of the hindsight bias; these were the availability heuristic and the representativeness heuristic. [9] In an elaboration of these heuristics, Beyth and Fischhoff devised the first experiment directly testing the hindsight bias. [10]