← all facts
decision making
You value an object more because you own it.
The endowment effect describes a persistent discrepancy between willingness-to-accept (WTA) and willingness-to-pay (WTP) valuations observed in experiments.
The 'emotional bond' explanation is an informal interpretation; the original study points to loss aversion, while critics argue it is an artifact of experimental design.
We struggle to see the true value of things we already possess.
Where this comes from
- Study
- Kahneman et al., 1990
- What the check found
- The study does show a ~2.5x gap, but the 'emotional bond' claim is speculation, and the robustness of the endowment effect is frequently challenged by procedural critics.
- Confidence
- Solid, with limits
Related
One of these every day, and every one names the study it came from. When a finding is contested, it says so.