Endowment effect for hedonic but not utilitarian goods

This research proposes that the WTA-WTP disparity between sellers and buyers in the endowment effect can be understood in terms of sellers' emotional attachment to the endowed item. Consistent with this hypothesis and how affective considerations are more diagnostic for hedonic than utilitarian goods, the results of an experiment indicate that the pricing disparity occurs primarily for hedonic goods. This finding explains many of the moderators that have been proffered for the endowment effect. (C) 2015 Elsevier B.V. All rights reserved.