The specific dumb joke in question: naming an outrageously high number, when asked about desired salary. As in, “I’d like $100,000 a year, but I’m willing to be reasonable.”
Why does it work? The anchoring effect, the cognitive bias that leads us to weight more heavily the first piece of information we receive in a negotiation.
A recent post by the Association for Psychological Science discusses research at the University of Idaho demonstrating the power of the anchoring effect. In two experiments, psychology professor Todd J. Thorsteinson showed that the anchoring effect is so strong, it works even if the negotiator is joking.
How an Implausibly High Anchor Leads to More Cash
In the experiments, he asked 200 college students to pretend they were hiring a candidate for an administrative position, and had reached the salary negotiation phase of the interview process.
“Half of the time the job candidate jokingly responded with an implausibly high anchor (‘I would like $100,000, but really I am just looking for something that is fair’) or a ridiculously low anchor (‘I would work for $1, but really I am just looking for something that is fair’),” the APS reports. “The control condition only presented the relevant anchor, the candidate’s prior salary of $29,000 a year.”
Participants were then asked to decide on a salary offer. They anchored on the higher number, even though it was presented as a joke. Ultimately, the candidates who “asked” for $100,000 received offers that were $3,000 higher than the control group.
“Incorporating a joking comment about implausible salary expectations may be a relatively easy way for job candidates to establish a high anchor and minimize negative reactions from employers,” writes Thorsteinson in the Journal of Applied Social Psychology.
Don’t Feel Like Kidding Around? Legislation Might Help You
The APS notes that it will soon be illegal to ask for salary history in Massachusetts … and there are indications that other states could follow. That’s a big deal, because employers often base their offer on information about a candidate’s previous salary, even if that salary was unfair.
“It reduces the information the employer has about what the candidate might expect in terms of salary. The employer typically has more information in these negotiations, as they know what they typically pay and the maximum that they are willing to pay,” Thorsteinson says. “Knowledge of the candidate’s salary history gives the employer information about what the candidate is likely to expect, which may be at the lower end of what the employer is willing to offer.”
h/t: The Science of Us
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