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Re: Ch. 8 - The High Price of Ownership
The subtitle of the chapter is "Why We Overvalue What We Have." By "overvalue," Ariely specifically means that we place a higher price on something that is already ours than we would actually pay for the item if it weren't. And in general, I think he's saying that anything that belongs to us--including opinions and beliefs--seem more valuable to us just because they're ours.
Ariey's main example, though, is a unique one and so can't be representative. The Duke students who go through an incredible rigmarole just to obtain "free" student tickets to basketball games were found to place a much higher price on these tickets than people who didn't have them would be willing to pay. The discrepancy could be easily explained by the agonies the winning students endured to get the tickets: that experience would naturally make them believe the tickets are worth much more than people who hadn't camped out for two days and then had to win a lottery, would estimate their value.
It seems to me that for items for which there is a generally known value, we pretty much price them in accordance to what others believe they're worth, if we're trying to sell them. If we're not trying to sell them, then it doesn't matter whether I think my car is worth 10 grand (if only it was). If anything, when I sell I tend to low-ball the price so the item will sell quickly and I won't have to dicker.
The idea of "virtual ownership" is interesting. That's when we've approached buying something and kind of salivated over it before we're even the owner. We come to think of it as rightfully ours, and if we're competing for it--say on an ebay auction--this virtual ownership can make us bid more than we'd planned to, because we can't bear "losing" something we thought of as ours.
As to becoming stuck on anything that we have or believe, I can't see a big difference between this and what Ariely talked about in an earlier chapter, imprinting and anchoring. Those two concepts can make us see what we have as reference points when we think of acquiring new things, and they can make us pretty conservative about changing our ideas about value.
Last edited by DWill on Tue Jun 29, 2010 4:51 pm, edited 1 time in total.
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