NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Is the Endowment Effect a Reference Effect?

Ori Heffetz, John A. List

NBER Working Paper No. 16715
Issued in January 2011
NBER Program(s):   EEE   PE

This paper is aimed to assess, with two lab experiments, to what extent Kőszegi and Rabin's (2006) model of expectations-based reference-dependent preferences can explain Knetsch's (1989) endowment effect. Departing from past work, we design an experiment that treats the two goods (a mug and a pen) symmetrically in all but in the probabilities with which they are expected to be owned. Thus, our "endowmentless" endowment effect experiment shuts down all alternative mechanisms while leaving expectations the only difference between treatments. We find no evidence that expectations alone can reproduce any of the original effect.

download in pdf format
   (502 K)

email paper

This paper is available as PDF (502 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w16715

Heffetz, Ori, and John A. List. 2013. Is the Endowment Effect an Expectations Effect? Journal of the European Economic Association, forthcoming.

Users who downloaded this paper also downloaded these:
Bordalo, Gennaioli, and Shleifer w17761 Salience in Experimental Tests of the Endowment Effect
Ericson and Fuster w19384 The Endowment Effect
List w16908 Does Market Experience Eliminate Market Anomalies? The Case of Exogenous Market Experience
Kling, List, and Zhao w16483 A Dynamic Explanation of the Willingness to Pay and Willingness to Accept Disparity
Landry, Lange, List, Price, and Rupp w17472 Is There a 'Hidden Cost of Control' in Naturally-Occurring Markets? Evidence from a Natural Field Experiment
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us