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 has decided that he needs some new furniture to spruce up his apartment, so he makes a trip to IKEA and picks out a nice coffee table with lots of umlauts in the name. As with all IKEA furniture, he takes it home in a box and puts it together himself. 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 charge $125 for his. 

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

About the Authors

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Dan Pilat

Dan is a Co-Founder and Managing Director at The Decision Lab. He is a bestselling author of Intention - a book he wrote with Wiley on the mindful application of behavioral science in organizations. Dan has a background in organizational decision making, with a BComm in Decision & Information Systems from McGill University. He has worked on enterprise-level behavioral architecture at TD Securities and BMO Capital Markets, where he advised management on the implementation of systems processing billions of dollars per week. Driven by an appetite for the latest in technology, Dan created a course on business intelligence and lectured at McGill University, and has applied behavioral science to topics such as augmented and virtual reality.

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Dr. Sekoul Krastev

Sekoul is a Co-Founder and Managing Director at The Decision Lab. He is a bestselling author of Intention - a book he wrote with Wiley on the mindful application of behavioral science in organizations. A decision scientist with a PhD in Decision Neuroscience from McGill University, Sekoul's work has been featured in peer-reviewed journals and has been presented at conferences around the world. Sekoul previously advised management on innovation and engagement strategy at The Boston Consulting Group as well as on online media strategy at Google. He has a deep interest in the applications of behavioral science to new technology and has published on these topics in places such as the Huffington Post and Strategy & Business.

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