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The Role of Endowment Effect in Transaction: Case Study of Apple Store

In: Proceedings of the 2022 2nd International Conference on Economic Development and Business Culture (ICEDBC 2022)

Author

Listed:
  • Yuchen Guo

    (Zhejiang University of Finance & Economic, School of Public Finance and Taxation)

  • Yi You

    (University of California, Berkeley, College of Letters & Science)

Abstract

ABSTRACT This article examines the how Apple Store employs the endowment effect to enhance their profits. While touching is proved to be able to enhance people’s psychological ownership and further contributes to higher evaluations, We hypothesized that endowment effect could be either activated or enhanced after touching. We simulated our hypotheses based on the WTP-WTA model, and compared the simulated results with real Apple retail store data. The activation theory was more prominent compared to the enhancement theory. Further research into the applications is warranted through improve model assumptions in order to guide better retail store design changes.

Suggested Citation

  • Yuchen Guo & Yi You, 2022. "The Role of Endowment Effect in Transaction: Case Study of Apple Store," Advances in Economics, Business and Management Research, in: Yushi Jiang & Yuriy Shvets & Hrushikesh Mallick (ed.), Proceedings of the 2022 2nd International Conference on Economic Development and Business Culture (ICEDBC 2022), pages 995-1002, Springer.
    • Handle: RePEc:spr:advbcp:978-94-6463-036-7_146
    DOI: 10.2991/978-94-6463-036-7_146
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