Why do we place disproportionately high value on things we helped to create?

The 

IKEA Effect

, explained.
Bias

What is the IKEA effect?

The IKEA effect, named after everyone’s favorite Swedish furniture giant, describes how people tend to value an object more if they make (or assemble) it themselves. More broadly, the IKEA effect speaks to how we tend to like things more if we’ve expended effort to create them.

A cartoon illustrating the IKEA effect. A person on the left thinks, 'Ugh... That's a crappy idea...' while another person on the right confidently thinks, 'No, no, it can't be because I thought it!' The second person's thought bubble shows a shining pile of poop, emphasizing how people overvalue their own creations, even if they're objectively poor.

Where this bias occurs

Alex decided he needed some new furniture to spruce up his apartment, so he made a trip to IKEA and picked out a nice coffee table with lots of umlauts. As with all IKEA furniture, he takes it home in a box and puts it together himself. Standing back and admiring his handiwork, he’s rewarded with a sense of accomplishment that makes all that frustrating labor worthwhile.

Sometime later, Alex is moving and decides to sell his furniture. After doing some Googling, he sees that very similar tables are being sold online for $100, but he decides to list his for $125. His subjective valuation of the coffee table is higher than its actual market value simply because he built it himself. Unfortunately, the effort Alex put into assembling the table won’t matter to buyers, and he’ll have difficulty selling it without reducing his asking price. This is a classic example of the IKEA effect, where our involvement in creating an item makes us feel as if it's worth more than it really is.

Related Biases

Sources

  1. Reb, J., & Connolly, T. (2007). Possession, feelings of ownership, and the endowment effect. Judgment and Decision making, 2(2), 107.
  2. Norton, M. I., Mochon, D., & Ariely, D. (2012). The IKEA effect: When labor leads to love. Journal of Consumer Psychology, 22(3), 453-460. https://doi.org/10.1016/j.jcps.2011.08.002
  3. Bandura, A. (1994). Self-efficacy. In V. S. Ramachaudran (Ed.), Encyclopedia of human behavior (Vol. 4, pp. 71-81). New York: Academic Press. (Reprinted in H. Friedman [Ed.], Encyclopedia of mental health. San Diego: Academic Press, 1998). 
  4. Ryan, R. M., & Deci, E. L. (2000). Self-determination theory and the facilitation of intrinsic motivation, social development, and well-being. American Psychologist, 55(1), 68-78. https://doi.org/10.1037/0003-066x.55.1.68
  5. Mochon, D., Norton, M. I., & Ariely, D. (2012). Bolstering and restoring feelings of competence via the IKEA effect. International Journal of Research in Marketing, 29(4), 363-369. https://doi.org/10.1016/j.ijresmar.2012.05.001
  6. Festinger, L. (1957). A theory of cognitive dissonance (Vol. 2). Stanford university press.
  7. Aronson, E., & Mills, J. (1959). The effect of severity of initiation on liking for a group. The Journal of Abnormal and Social Psychology, 59(2), 177-181. https://doi.org/10.1037/h0047195
  8. Ackerman, C. E. (2019, April 7). Pollyanna principle: The psychology of positivity bias. PositivePsychology.com. https://positivepsychology.com/pollyanna-principle/
  9. Lovallo, D., & Kahneman, D. (2003, July). Delusions of success: How optimism undermines executives’ decisions. Harvard Business Review. https://hbr.org/2003/07/delusions-of-success-how-optimism-undermines-executives-decisions
  10. Beggan, J. K. (1992). On the social nature of nonsocial perception: The Mere ownership effect. Journal of Personality and Social Psychology, 62(2), 229-237. https://doi.org/10.1037/0022-3514.62.2.229
  11. Marsh, L. E., Kanngiesser, P., & Hood, B. (2018). When and how does labour lead to love? The ontogeny and mechanisms of the IKEA effect. Cognition, 170, 245-253. https://doi.org/10.1016/j.cognition.2017.10.012
  12. Dumont, J. (2020, June 5). Meal kit industry expected to hit $20B by 2027. Grocery Dive. https://www.grocerydive.com/news/meal-kit-industry-expected-to-hit-20b-by-2027/579265/
  13. Moorhead, J. (2016, April 6). Meal kits vs. groceries: A dollar-to-dollar investigation. The Kitchn. https://www.thekitchn.com/are-meal-kits-more-expensive-than-groceries-230031
  14. Mortimer, G., Mathmann, F., & Grimmer, L. (2019, April 22). How the ‘IKEA effect’ subtly influences how you spend. BBC Worklife. https://www.bbc.com/worklife/article/20190422-how-the-ikea-effect-subtly-influences-how-you-spend
  15. Vedantam, S. (2013, February 6). Why You Love That Ikea Table, Even If It’s Crooked [Radio episode]. In Hidden Brain. NPR.
  16. Radtke, T., Liszewska, N., Horodyska, K., Boberska, M., Schenkel, K., & Luszczynska, A. (2019). Cooking together: The IKEA effect on family vegetable intake. British Journal of Health Psychology, 24(4), 896-912. https://doi.org/10.1111/bjhp.12385
  17. Ariely, D. (n.d.). The IKEA Effect [Video]. YouTube. https://www.youtube.com/watch?v=jkaWYKlnli0
  18. Kruger, J., Wirtz, D., Van Boven, L., & Altermatt, T. W. (2004). The effort heuristic. Journal of Experimental Social Psychology, 40(1), 91–98. https://doi.org/10.1016/S0022-1031(03)00065-9 
  19. Belk, R. W. (1988). Possessions and the extended self. Journal of Consumer Research, 15(2), 139–168. https://doi.org/10.1086/209154 
  20. GoodHabitz. (n.d.). The IKEA effect in learning and development. GoodHabitz. https://goodhabitz.com/resources/blog/the-ikea-effect-in-learning-and-development 
  21. Kahneman, D., Knetsch, J. L., & Thaler, R. H. (1991). Anomalies: The endowment effect, loss aversion, and status quo bias. Journal of Economic Perspectives, 5(1), 193–206. https://doi.org/10.1257/jep.5.1.193 
  22. Sarstedt, M., Neubert, D., & Barth, K. (2017). The IKEA Effect. A conceptual replication. Journal of Marketing Behavior, 2(4), 307-312. DOI: 10.1561/107.00000039

About the Author

Smiling woman with long hair stands in front of a lush plant with pink and yellow flowers, near what appears to be a house exterior with horizontal siding and a staircase.

Kira Warje

Kira holds a degree in Psychology with an extended minor in Anthropology. Fascinated by all things human, she has written extensively on cognition and mental health, often leveraging insights about the human mind to craft actionable marketing content for brands. She loves talking about human quirks and motivations, driven by the belief that behavioural science can help us all lead healthier, happier, and more sustainable lives. Occasionally, Kira dabbles in web development and enjoys learning about the synergy between psychology and UX design.

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