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In Piaget's theory, egocentrism refers to a child's inability to see a situation from other people's perspectives. This cognitive limitation is particularly prominent during the preoperational stage of development, which typically occurs between ages 2 and 7. As a result of this egocentrism, children often attribute human-like qualities and motivations to inanimate objects, leading to a form of thinking known as animistic thinking. For example, a child might believe that the sun is "happy" when it shines or that a toy can feel sad if it is left alone.

This process of assigning life-like characteristics to nonliving things illustrates how egocentrism manifests in children's cognitive development, as they struggle to understand that others have thoughts and feelings distinct from their own. Thus, animistic thinking is a direct outcome of the egocentric perspective, where children project their own experiences onto the world around them, reflecting their limited understanding of differing viewpoints.