Regret, disappointment and the endowment effect
AbstractThe endowment effect is the finding that minimum selling prices for a particular good exceed maximum buying prices. We build on and extend previous research showing that emotions influence the endowment effect, and reveal that the two negatively valenced decision-related emotions, regret and disappointment, have distinct effects on the valuation of an object. We found that an induction of regret eliminates the classic endowment effect, whereas an induction of disappointment reverses it. The findings demonstrate the necessity of a specific emotion approach to understand the effects on decision making.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Economic Psychology.
Volume (Year): 32 (2011)
Issue (Month): 6 ()
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Endowment effect; Regret; Disappointment; Emotion;
Find related papers by JEL classification:
- C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
- M31 - Business Administration and Business Economics; Marketing; Accounting - - Marketing and Advertising - - - Marketing
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