We overvalue the things that we already own

We tend to value items we own higher than items we don't own, even if they are otherwise identical. This phenomenon is called the "Endowment Effect" and was researched by Richard Thaler.

There have been studies by Kahnemann on this effect as well, where subjects were given coffee mugs were tasked to sell them to other participants. Participants with mugs saw the value of mugs as much higher as those without mugs ($5.25 vs $2.50).

Book - Essentialism.. the disciplined pursuit of lessBook - Essentialism.. the disciplined pursuit of less

Metadata:

author: Greg McKeown
title: Essentialism: the disciplined pursuit of less
year: [[2014]]



highlights that this effect can cloud our judgement about the opportunities in our life. When deciding what is essential and what is non essential, we tend to overvalue the activities we already partake in. McKeown recommends Zero based budgeting can be used for personal decision makingZero based budgeting can be used for personal decision making
Zero based budgeting: Instead of budgeting with the existing cost calculation, start from scratch, beginning at a cost of zero and including items one after the other.

[[Book - Essentialism.. the ...
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Marie Kondo tidying up missing

How do Cognitive Dissonance and Loss Aversion play into this?