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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.
Stulti autem malorum memoria torquentur, sapientes bona praeterita grata recordatione renovata delectant. Itaque ab his ordiamur. Duo Reges: constructio interrete. Illum mallem levares, quo optimum atque humanissimum virum, Cn.
Quam ob rem tandem, inquit, non satisfacit? Qui ita affectus, beatum esse numquam probabis; Non minor, inquit, voluptas percipitur ex vilissimis rebus quam ex pretiosissimis. Idem fecisset Epicurus, si sententiam hanc, quae nunc Hieronymi est, coniunxisset cum Aristippi vetere sententia. Quis suae urbis conservatorem Codrum, quis Erechthei filias non maxime laudat? Tollenda est atque extrahenda radicitus. Confecta res esset. Etsi ea quidem, quae adhuc dixisti, quamvis ad aetatem recte isto modo dicerentur. Quis Pullum Numitorium Fregellanum, proditorem, quamquam rei publicae nostrae profuit, non odit? Praeclare hoc quidem. Nec vero sum nescius esse utilitatem in historia, non modo voluptatem.
- Be mindful of the endowment heuristic in sales conversations.
When purchasing something, be aware ...
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Nam si propter voluptatem, quae est ista laus, quae possit e macello peti? Pugnant Stoici cum Peripateticis. Sed utrum hortandus es nobis, Luci, inquit, an etiam tua sponte propensus es? Sed quid ages tandem, si utilitas ab amicitia, ut fit saepe, defecerit? Stulti autem malorum memoria torquentur, sapientes bona praeterita grata recordatione renovata delectant. An me, inquis, tam amentem putas, ut apud imperitos isto modo loquar? At hoc in eo M.
Maximas vero virtutes iacere omnis necesse est voluptate dominante. Heri, inquam, ludis commissis ex urbe profectus veni ad vesperum. Iam in altera philosophiae parte. Quod cum dixissent, ille contra. Est enim effectrix multarum et magnarum voluptatum. Ex rebus enim timiditas, non ex vocabulis nascitur. Nunc omni virtuti vitium contrario nomine opponitur. Vide, quaeso, rectumne sit. Sin autem est in ea, quod quidam volunt, nihil impedit hanc nostram comprehensionem summi boni. Tamen a proposito, inquam, aberramus.
Duo Reges: constructio interrete. Atqui reperies, inquit, in hoc quidem pertinacem; Videmusne ut pueri ne verberibus quidem a contemplandis rebus perquirendisque deterreantur? Videamus igitur sententias eorum, tum ad verba redeamus. Si longus, levis; Dulce amarum, leve asperum, prope longe, stare movere, quadratum rotundum. Dic in quovis conventu te omnia facere, ne doleas. Isto modo, ne si avia quidem eius nata non esset. Huius ego nunc auctoritatem sequens idem faciam.
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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