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No, it's not just you — we all tend to overestimate the value of our possessions, and there's a name for it.
Non est igitur voluptas bonum. Ipse Epicurus fortasse redderet, ut Sextus Peducaeus, Sex. Aliter enim explicari, quod quaeritur, non potest. Atque haec ita iustitiae propria sunt, ut sint virtutum reliquarum communia. Non modo carum sibi quemque, verum etiam vehementer carum esse? Quae hic rei publicae vulnera inponebat, eadem ille sanabat.
Atque his de rebus et splendida est eorum et illustris oratio. Non enim quaero quid verum, sed quid cuique dicendum sit. Nihil acciderat ei, quod nollet, nisi quod anulum, quo delectabatur, in mari abiecerat. Beatum, inquit. Utrum igitur tibi litteram videor an totas paginas commovere? Partim cursu et peragratione laetantur, congregatione aliae coetum quodam modo civitatis imitantur; Esse enim, nisi eris, non potes. Efficiens dici potest.
- Be mindful of the endowment heuristic in sales conversations.
When purchasing something, be aware ...
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Nihil opus est exemplis hoc facere longius. Suam denique cuique naturam esse ad vivendum ducem. Mihi quidem Antiochum, quem audis, satis belle videris attendere. Et quidem saepe quaerimus verbum Latinum par Graeco et quod idem valeat; Aliter enim explicari, quod quaeritur, non potest. Alterum significari idem, ut si diceretur, officia media omnia aut pleraque servantem vivere. Quodcumque in mentem incideret, et quodcumque tamquam occurreret. Igitur neque stultorum quisquam beatus neque sapientium non beatus.
Videmusne ut pueri ne verberibus quidem a contemplandis rebus perquirendisque deterreantur? Qua tu etiam inprudens utebare non numquam. Quod vestri quidem vel optime disputant, nihil opus esse eum, qui philosophus futurus sit, scire litteras. Nemo nostrum istius generis asotos iucunde putat vivere. Eaedem enim utilitates poterunt eas labefactare atque pervertere. Ampulla enim sit necne sit, quis non iure optimo irrideatur, si laboret? At miser, si in flagitiosa et vitiosa vita afflueret voluptatibus. Id enim natura desiderat. Polemoni et iam ante Aristoteli ea prima visa sunt, quae paulo ante dixi. Disserendi artem nullam habuit.
Aliam vero vim voluptatis esse, aliam nihil dolendi, nisi valde pertinax fueris, concedas necesse est. Duo Reges: constructio interrete. Age sane, inquam. Invidiosum nomen est, infame, suspectum. Sed quanta sit alias, nunc tantum possitne esse tanta. Ex ea difficultate illae fallaciloquae, ut ait Accius, malitiae natae sunt. Piso, familiaris noster, et alia multa et hoc loco Stoicos irridebat: Quid enim? An tu me de L. Laelius clamores sofòw ille so lebat Edere compellans gumias ex ordine nostros.
There have been critics of the Endowment Heuristic, with some claiming it does not exist or at least is not as apparent in real life as in fixed experiments. For example, some argue that the results from the mug experiment (see the ‘In Practice’ section) was more due to artificial scarcity.
Mugs.
This 1991 paper by Daniel Kahneman, Jack Knetcsch and Richard Thaler describes the classic example of the endowment heuristic involving mugs. In it, participants were given a mug and then given the chance to trade it. They found that the value attributed to owned mugs was twice as high as they were actually willing to pay for such a mug that they did not own.
The endowment heuristic is part of behavioural economics, stemming from the fast and slow thinking mental model and relating closely to loss aversion.
Use the following examples of connected and complementary models to weave availability heuristic into your broader latticework of mental models. Alternatively, discover your own connections by exploring the category list above.
Connected models:
- Fast and slow thinking: providing broader context to the endowment effect.
- Loss aversion and opportunity cost: a closely linked heuristic and bias.
- Lock in effect: and challenge of customer loyalty.
Complementary models:
- Design thinking: consider strategies to co-design and increase ownership of initiatives.
- Lean startup: iterating with minimum viable products, allowing audience groups to access and own quickly and cheaply.
Aristotle noted the tendency towards the Endowment Effect in Ancient Greece, when he explained: “For most things are differently valued by those who have them and by those who wish to get them: what belongs to us, and what we give away, always seems very precious to us.”
However, the term itself was first coined by the behavioural economist Richard Thaler in his 1980 paper entitled ‘Toward a Positive Theory of Consumer Choice.’
My Notes
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