4 ms·

This is a basic finding in experimental economics (Thaler comes to mind, but it's been a while). I remember an experiment showing this in my first class in '03

by wjnc 6y ago

This is a basic finding in experimental economics (Thaler comes to mind, but it's been a while). I remember an experiment showing this in my first class in '03 which we used as a case study for many, many lectures that followed. That it also holds for babies is quite cool. It's innate that we have strong preferences for things we have in our hands! Even if exactly it getting in our hands is totally random. Edit: Endowment effect with one famous experiment with mugs from Kahneman (1990). That's the one we replicated in class. Pretty cool come to think of it to use a famous experiment as a first introduction to the field. [1] https://en.m.wikipedia.org/wiki/Endowment_effect https://en.m.wikipedia.org/wiki/Endowment_effect

thaumasiotes 6y ago
Note that the endowment effect does not exist when the value of the object in question is well understood. This makes perfect sense; in the words of something I read recently about the working of financial markets, "if somebody wants to trade with you, your first thought should be 'what does he know that I don't?'"
- robocat 6y ago
  “if somebody wants to trade with you, your first thought should be 'what does he know that I don't?'" I think the economic term is adverse selection: https://www.investopedia.com/terms/a/adverseselection.asp https://www.investopedia.com/terms/a/adverseselection.asp
in_cahoots 6y ago
This article states the opposite: when researchers chose which object the babies held, their preference went away.
jonnycomputer 6y ago
How does the endowment affect apply here? It looked like the babies tended to choose the novel item instead of the item they hadn't chosen previously.
dllthomas 6y ago
> Even if exactly it getting in our hands is totally random. But only if (we think) it's our own doing, right? Because (per another comment - I haven't paid to read the study) they didn't see the same effect if they gave the babies the toy.

by wjnc 6y ago

thaumasiotes 6y ago

Note that the endowment effect does not exist when the value of the object in question is well understood. This makes perfect sense; in the words of something I read recently about the working of financial markets, "if somebody wants to trade with you, your first thought should be 'what does he know that I don't?'"

robocat 6y ago
“if somebody wants to trade with you, your first thought should be 'what does he know that I don't?'" I think the economic term is adverse selection: https://www.investopedia.com/terms/a/adverseselection.asp https://www.investopedia.com/terms/a/adverseselection.asp

in_cahoots 6y ago

This article states the opposite: when researchers chose which object the babies held, their preference went away.

jonnycomputer 6y ago

How does the endowment affect apply here? It looked like the babies tended to choose the novel item instead of the item they hadn't chosen previously.

dllthomas 6y ago

> Even if exactly it getting in our hands is totally random. But only if (we think) it's our own doing, right? Because (per another comment - I haven't paid to read the study) they didn't see the same effect if they gave the babies the toy.