Neural antecedents of the endowment effect.
The "endowment effect" refers to the tendency to place greater value on items that one owns-an anomaly that violates the reference-independence assumption of rational choice theories. We investigated neural antecedents of the endowment effect in an event-related functional magnetic resonance imaging (fMRI) study. During scanning, 24 subjects considered six products paired with 18 different prices under buying, choosing, or selling conditions. Subjects showed greater nucleus accumbens (NAcc) activation for preferred products across buy and sell conditions combined, but greater mesial prefrontal cortex (MPFC) activation in response to low prices when buying versus selling. During selling, right insular activation for preferred products predicted individual differences in susceptibility to the endowment effect. These findings are consistent with a reference-dependent account in which ownership increases value by enhancing the salience of the possible loss of preferred products.
Psychology and Neuroscience, Stanford University, Stanford, CA 94305, USA. knutson@psych.stanford.edu
Brian
B
Knutson
G Elliott
GE
Wimmer
Scott
S
Rick
Nick G
NG
Hollon
Drazen
D
Prelec
George
G
Loewenstein
D001921:Brain / Q000033:anatomy & histology / Q000098:blood supply / Q000502:physiology*; D001931:Brain Mapping; D003657:Decision Making / Q000502:physiology*; D005260:Female; D005376:Financial Management; D007839:Functional Laterality; D006801:Humans; D007091:Image Processing, Computer-Assisted / Q000379:methods; D007206:Individuality; D008279:Magnetic Resonance Imaging / Q000379:methods; D008297:Male; D010100:Oxygen / Q000097:blood; D012201:Reward; D013647:Task Performance and Analysis
D010100:Oxygen