Endowment Effect
We value things we own more than identical things we don't own.
The endowment effect (also known as divestiture aversion and related to the notion of loss aversion) is the hypothesis that people ascribe more value to things merely because they own them. This was demonstrated by giving people mugs and immediately offering to trade them for equivalent chocolate bars — people who received mugs overvalued them relative to people who received chocolate bars, and few were willing to trade.
What it looks like in the wild.
- Everyday life Used Car Overvaluation People consistently overestimate the value of their own car when selling it, compared to market pricing for identical cars.
Someone has already built a business on this.
Biases are not only private errors. They are design targets — patterns deliberately engineered into interfaces because they reliably work.
- E-commerce Free Trial Ownership Free trials exploit the endowment effect — once users have access to a product, giving it up feels like a loss, driving conversion to paid subscriptions.
Recognising a definition is not the same skill as spotting it.
Two scenarios from the app, with distractors drawn from the same family of biases — which is what makes them hard.
A homeowner is offered a free upgrade to a new kitchen appliance but prefers to keep their old, slightly worn one.
A person trades in their old phone. They're disappointed with the trade-in value, feeling their phone is worth more than the offered discount.
Biases rarely arrive alone.
Understand more. Assume less.
188 biases, 18,869 scenarios, and a record of how you actually decide.
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