Contrast Effect
Our judgement of something is distorted by whatever we experienced just before it.
What it means
The contrast effect is the way our perception of something shifts depending on what we compare it to - or, more commonly, what we've just experienced. A warm room feels hot if you've just come in from the cold. A decent meal feels disappointing if the previous one was exceptional. A reasonable salary feels inadequate if you've just heard what your colleague earns.
This happens because our brains don't evaluate things in a vacuum. We're constantly comparing, whether we mean to or not, and those comparisons reshape our perception of the thing we're actually looking at. The object hasn't changed - but our experience of it has, because the context has shifted.
The contrast effect is weaponised constantly in marketing and negotiation. Estate agents show you a terrible property first so the decent one feels amazing. Retailers put the expensive item next to the mid-range one to make it look like a bargain. Interviewers unconsciously mark candidates up or down based on who they saw before. It's everywhere, and most of the time we don't notice it happening.
In the real world
You're interviewing candidates for a role. The first candidate is outstanding - confident, articulate, deeply experienced. The second candidate is solid and capable, but after the first, they seem mediocre by comparison. You rate them lower than you would have if they'd gone first. Nothing about them has changed; only the order changed. The contrast effect has reshaped your judgement of a real person based on something entirely irrelevant.
The thought to hold onto
You're never judging anything on its own merits - you're always judging it relative to what came before. Knowing this won't make the effect disappear, but it gives you a fighting chance of catching it.