Endowment effect

Description

Related to status quo bias, the endowment effect describes how owners of goods view what they own more positively than they would otherwise. This bias influences people to pay more to retain a goods that own, and influences people to not exchange something they own for an object of the same value. This leads to people only being willing to sell what they own for more than it is worth, simply because they own it.

Example

In one study, participants were given either chocolate bars or coffee mugs. They were then offered the ability to trade for the other good. No matter which good they had been given first, participants more often chose not to trade their item.

Further Reading