The Effect of Ownership History on the Valuation of Objects
14 Pages Posted: 19 Dec 2010
Date Written: December 1, 1998
Abstract
Previous work on the endowment effect has demonstrated that current ownership status affects object valuation and that this effect occurs instantaneously upon possession of an object. The current work presents findings from four studies which indicate that the history of past ownership can also affect object valuation. For objects currently in one's possession, we find that valuation increases with duration of ownership. For objects not in one's possession, previous ownership experience increases valuation, and the increase seems to be related to the duration of ownership before loss. In addition, the perceived attractiveness of objects, although not instantly affected by endowment, is found to increase with duration of ownership.
Keywords: ownership history, endowment effect, valuation
JEL Classification: M30, M39
Suggested Citation: Suggested Citation