Economics Anchoring Questions
Anchoring influences decision making in the airline industry by shaping the reference point from which decisions are made. For example, when setting ticket prices, airlines may anchor their pricing strategy to the average market price or to their competitors' prices. This anchoring effect can lead to a bias in decision making, as airlines may be reluctant to deviate too far from the established anchor, even if it may be more profitable to do so. Additionally, anchoring can also influence consumer behavior, as passengers may use the anchor price as a reference point when evaluating the value of a ticket, leading them to make decisions based on the perceived deviation from the anchor rather than the actual value of the ticket.