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Tag: Endowment Effect

Unpacking buyer-seller differences in valuation from experience: A cognitive modeling approach

Published in: Psychonomic Bulletin & Review, Volume 24, Issue 6, December 2017, 1742-1773 Abstract “People often indicate a higher price for an object when they own it (i.e., as sellers) than when they do not (i.e., as buyers)—a phenomenon known as the endowment effect. We develop a cognitive modeling approach to formalize, disentangle, and compare alternative psychological accounts (e.g., loss aversion, loss attention, strategic misrepresentation) of such buyer-seller differences in pricing decisions of monetary lotteries. To also be able to test possible buyer-seller differences in memory and learning, we study pricing decisions from experience, obtained with the sampling paradigm, where people learn… Read More