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De chico jugaba en la plaza Colombia.

Klass & Zeiler: Endowment theory is wrong.

Klass, G., & Zeiler, K. (2013). Against Endowment Theory: Experimental Economics and Legal Scholarship. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.2224105

This is a remarkable article. The authors make a clear-cut claim and justify this claim by means of a strong and convincing argument, grounded in experimental research; they put their claim in historical context; they spell out some implications of their claim for future research; and all along they cover an impressive amount of literature from different disciplines. They know their shit back and forth.

The simple claim is that endowment theory, at least as it has been commonly interpreted in behavioral economics and, derivatively, in legal studies, should be rejected.

The core of their argument is straightforward. It is generally accepted that the endowment effect expresses itself in the laboratory by means of exchange asymmetries: for example, people who are randomly assigned the mug don’t want to trade it for the pen, and vice-versa. In valuation studies, it expresses itself in a gap between the Willing-To-Accept and Willing-To-Pay prices: the amount of money someone is willing to pay for a concert ticket is less than what the same person is willing to accept to give up a ticket that she already has. Plott & Zeiler (2005), however, in a series of studies, found that those gaps and asymmetries can be made to disappear by manipulating contextual variables. For instance, typically, when the endowed good is handed to the participant, she is told, “I’m giving you the mug.  It is a gift.  You own it.  It is yours.”  But this utterance might signal that the mug is very valuable. When one substitutes this phrasing with a simpler formulation such as “the mug is yours, you own it,” and one also tweaks other factors (decisions are anonymous, the pen and the mug are at the same physical distance from the subject, etc.), the endowment effect tends to vanish. The endowment effect, to sum up, is an artifact of the researchers’ faulty methods that goes away when one controls all relevant variables.

The article provides historical context for the emergence of endowment theory. Behavioral economists used the endowment effect as a paradigmatic spearhead against neoclassical economics. The clash (and the types of arguments used) reminds me of intercultural psychology critique of homo economicus (Henrich et al., 2007).

In the conclusions, the authors emphasize that simple experiments on human decision making do not translate automatically into normative or political recommendations. Rather, they contribute to corroborate or falsify a theory, and it is theories that can eventually have normative implications.

Klass and Zeiler’s description of the endowment effect changed my understanding of it. They emphasize that, for endowment theory to be true, the increase in value has to result only from pure ownership, that is, from the mere fact that one has an entitlement. Let’s say that there are two mugs, and I own mug 1 but not mug 2, and mug 1 and mug 2 are identical, and both are placed at the same distance from me, and there are no facts in the object history that create any bond between me and any of the mugs. Klass and Zailer seem to claim that, according to endowment theory, I should still value mug 1 more than mug 2, because of the sheer fact that I am mug 1’s owner.

That is: Klass and Zeiler emphasize that pure, “abstract” ownership should be responsible for the endowment effect, and not the history of how the object came to be mine. Thus, they seem to exclude value resulting from attachment to the object (“emotional” or “sentimental” value). By free association, I am reminded of the Kantian view of duty as resulting from bare respect for the moral law. That is: I behave morally not because I feel some subjective satisfaction or pride in being moral, or because some utilitarian calculation that moral behavior will produce the greatest good. I think and act in accordance with my duty because that’s what I ought to do, period. In endowment theory, my thinking and acting is affected by my right, period.

I previously thought (perhaps erroneously) that the endowment effect relied in a richer conception of ownership that included psychological aspects, such as the individual’s attachment to the specific object and the pride one feels for one’s belongings. In my opinion, this view is represented by Gelman & Davidson’s (2016) study on children’s preference for unique owned objects; McEwan, Pesowski, & Friedman (2016) research showing that children view owned objects as non-fungible; Gelman, Manczak, & Noles (2012) paper that claims to have identified an endowment effect in children 2 and 3 years of age: “The present findings suggest that positive evaluation of and preference for one’s own possessions is a basic cognitive disposition, even before children have experience with conventional economic transactions.” There are many other researchers in the field of ownership (Rochat, Ross, etc.) that seem to have this richer understanding of what owning an object means. Perhaps developmental psychologists have misread endowment theory; perhaps they’re talking about a different phenomenon.

This richer view of the subject-object relationship has many antecedents in psychology. One may think of attachment theory, Winnicott’s transitional objects, etc. These different theories are not akin to the cold inclusion of the ownership title in the algorithm that calculates value, but to the warm fact that I value an object because it became mine in a certain context, as result from a certain history. Objects are extensions of the self (here I could quote some twenty developmental psychologists); ownership of property constitutes an important aspect of the construction of self-identity and of boundaries between myself and others.

Hume says something similar in his book on Emotions, in his Enquiry Concerning Human Understanding. One is proud only of the things one owns. In Humean terms, the idea that this mug is splendid and the idea that it belongs to me are associated to each other. The fact that the things that relate to my self (my body, my watch, my horse, my children, my estate, my country) are beautiful or valuable increases my pride; conversely, if my self-esteem is high I will tend to consider that my stuff is the best, just because it’s mine.

References:

Gelman, S. A., & Davidson, N. S. (2016). Young children’s preference for unique owned objects. Cognition. https://doi.org/10.1016/j.cognition.2016.06.016

Gelman, S. a., Manczak, E. M., & Noles, N. S. (2012). The nonobvious basis of ownership: Preschool children trace the history and value of owned objects. Child Development, 83(5), 1732–1747. https://doi.org/10.1111/j.1467-8624.2012.01806.x

Henrich, J., Boyd, R., Bowles, S., Camerer, C., Fehr, E., Mcelreath, R., … Sciences, B. (2007). “Economic Man” in Cross-cultural Perspective : Behavioral Experiments in 15 Small-scale Societies. Social Dynamics, 204(06), 795–815.

Klass, G., & Zeiler, K. (2013). Against Endowment Theory: Experimental Economics and Legal Scholarship. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.2224105

McEwan, S., Pesowski, M. L., & Friedman, O. (2016). Identical but not interchangeable: Preschoolers view owned objects as non-fungible. Cognition, 146, 16–21. https://doi.org/10.1016/j.cognition.2015.09.011

Plott, C. R., & Zeiler, K. (2005, June 1). The Willingness to Pay-Willingness to Accept Gap, the “Endowment Effect,” Subject Misconceptions, and Experimental Procedures for Eliciting Valuations. Retrieved from https://papers.ssrn.com/sol3/papers.cfm?abstract_id=615861

 

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Vondervoort & Friedman – Ownership of objects and ownership of one’s own body

Van de Vondervoort, J. W., & Friedman, O. (2015). Parallels in preschoolers’ and adults’ judgments about ownership rights and bodily rights. Cognitive Science. https://doi.org/10.1111/cogs.12154

Another interesting article by the prolific Ori Friedman and his team. They have produced a sustained series of very focused studies, guided by the conviction that ownership can be explored within a cognitive framework, and that our knowledge about the development of ownership can be built piece by piece. They divide the field into small issues and take them up one by one.

The paper starts by asking interesting and relevant questions about the relationship between ownership of objects and ownership of one’s own body.

Young children appreciate ownership rights from very early on (around 2 or 3 years of age, depending on the author and research method). They recognize ownership rights before they appreciate rights in other domains. Bodily rights (rights to control one’s own body) also seem to appear early in development. Based on legal theory, one might hypothesize that these two kinds of rights are closely related (remember John Locke’s justification of the origin of private property?). One possible question, then, is to what extent ownership rights and bodily rights are related to each other, both in legal theory and in cognitive development. Do they follow from the same principles, but are applied to two different kinds of entities? Or, alternatively, do they belong to completely different conceptual and normative domains?

The paper, then, examines whether people make similar evaluations when considering the acceptability of actions performed on owned property and body parts. Preschoolers (Experiment 1) and adults (Experiment 2) were presented with scenarios about a boy and a girl, and they evaluated how good or bad the boy’s actions were. The scenarios varied in whether the target of the boy’s action was an owned object or a body part, in whether the target belonged to the boy or to a girl, and in whether the girl approved of the boy’s action.

The results: preschool-aged children and adults responses did not vary when evaluating the acceptability of harmless actions targeting owned property and body parts.  The same pattern of responses was observed for both cases (scenarios targeting body parts and scenarios targeting owned property).

Evaluations were influenced by two other manipulations: whether the target belonged to the agent or another person, and whether that other person approved of the action. The researchers found that, when the other person approved of the action, participants’ judgments were positive regardless of who the target belonged to. In contrast, when that person disapproved, judgments depended on who the target belonged to (owner – non-owner). These findings show that young children grasp the importance of approval or consent for ownership rights and bodily rights. Both children and adults seem to understand that, in scenarios where the girl disapproved of the boy’s actions, he violated her ownership rights when he acted on her property (or body), but not when he acted on his own property (or body).

The study lends support to the idea that people’s notions of ownership rights are related to their appreciation of bodily rights.

Differently from other, more straightforward and elegant studies by Ori Friedman and his colleagues, the method used here is somewhat complicated: the 5-grades complex scale used to measure children’s responses (considering they were working with 4 y.o.’s) ;the fact that the active agent is always a boy and the passive evaluator is always a girl (which probably creates a gender confound); the fact that children are have to react to the character’s opinion with their own opinion (in a third person perspective)… This complicated setup obscures the results to some extent.

 

Ownership and emotions in toddlers and preschoolers

Pesowski, M. L., & Friedman, O. (2015). Preschoolers and toddlers use ownership to predict basic emotions. Emotion (Washington, D.C.). https://doi.org/10.1037/emo0000027

 


 

This is a very simple and elegant study that shows that toddlers and preschoolers appreciate how ownership affects emotions. The researchers used a couple of straightforward scripts to present children with situations involving transgression of ownership rights, and to ask about the emotions elicited in the characters. For example, a character left a teddy bear on a bench and, upon returning, found her teddy bear (vs. someone else’s teddy bear, in the other condition) missing. In another situation, a character saw another character using her toy.

The researchers concluded that preschoolers and toddlers appreciate how ownership influences emotions.  Children understood that an owner would be more saddened by the disappearance of an object belonging to her as compared with the disappearance of someone else’s property.

The authors believe these findings are “striking” because in two (out of three) experiments the violation of ownership rights was harmless and did not involve an overtly negative outcome. In my words, children understand that the characters are sad or mad not because of an “objective” damage, harm or loss, but because of the violation of their rights. A child might be upset by the very fact that someone is touching her toy. This territoriality is at the core of the phenomenon of ownership. The paper seems to suggest that, already at two, children master the fundamentals of the institution of ownership. They know the rules of the game.

The authors also think their results are significant because “few previous studies show that 2-year-olds can predict emotions”, and because “no previous studies found that 2-year-olds are sensitive to other people’s ownership rights.” In particular, they refer to a well-known paper by Rossano, Rakoczy, & Tomasello (2011) that claims that 3-year-olds, but not 2-year-olds, defend third-person ownership rights.

 

Cited:

Pesowski, M. L., & Friedman, O. (2015). Preschoolers and toddlers use ownership to predict basic emotions. Emotion (Washington, D.C.). https://doi.org/10.1037/emo0000027

Rossano, F., Rakoczy, H., & Tomasello, M. (2011). Young children’s understanding of violations of property rights. Cognition, 121(2), 219–227.

How is a Possession “Me” or “Not Me”?

Kleine, S. S., Kleine, R. E., & Allen, C. T. (1995). How is a Possession “Me” or “Not Me”? Characterizing Types and an Antecedent of Material Possession Attachment. Journal of Consumer Research. http://doi.org/10.1086/209454

The researchers carried out two studies in which they interviewed adults (N=30 for the first one, N=24 for the second one), using Q-methodology to describe their attachment to objects across a number of variables or “factors.”

The authors found that study participants felt strongly attached to some possessions that they liked, were proud of, or felt that expressed who they were. Participants tend to keep these possessions, at least as long as they feel they represent them; when they stop having this positive valence, they get rid of them. However, there seems to be a group of possessions that participants did not like anymore and, more importantly, felt not connected with. However, they did not dispose of such “not me” possessions. Those were the possessions that were gifts, or that were personally linked to a significant person. Thus they found that 52 percent of the “not-me” possessions were gifts. “Apparently, gift receipt adds a layer of affiliation that makes even not-me objects more difficult to dispossess.”

This study shows an interesting approach to ownership that is certainly different from the stuff I’m used to read.  For starters, it was carried out with adult participants and it was published in a “Journal of Consumer Research”. Therefore, the authors do not deal with cognitive-developmental issues. The methodology seems to me obscure and not very rigorous, although I confess I’m no expert in Q-methodology. Some of the conclusions strike me as outright arbitrary. However, it was worth the read.

Susan Gelman on children’s preference for unique owned objects

Gelman, S. A., & Davidson, N. S. (2016). Young children’s preference for unique owned objects. Cognition. https://doi.org/10.1016/j.cognition.2016.06.016

This is an incredible and profound study on children’s attachment to objects, with implications both for cognitive and emotional development. It’s also a study that amazes me for the amount of work it required from researchers (who had to find brand-new replicas of more than 100 children’s attachment objects).

The experimental design is quite simple. Researchers asked 36 three-year-olds to choose between two toys for either themselves or the researcher: an old (visibly used) toy vs. a new (more attractive) toy matched in type and appearance (e.g., old vs brand-new blanket). Focal pairs contrasted an old toy that belonged to the child with a matched new object; control pairs contrasted toys the child had never seen before.

The conclusion of the study is that, by 3 years of age, young children place special value on unique owned objects. Children prefer their original objects to newer, better versions, but only in the case of the focal pairs (with their objects of attachment) and not with the control pairs (objects the child had never seen before). These findings are consistent with the view that possessions are extensions of the self.

In addition, these preferences hold for “sleep” objects (blanket, pillow) and toys representing an animated character (dolls, action figures) but not for inanimate objects (a car, a toy hammer, etc.) Uniqueness is valued for sleep objects and animate toys, but not for inanimate toys. Moreover, in 30 out of 31 cases, attachment objects had a proper name. Ownership, attachment and anthropomorphism (eyes, animated features, soft or furry texture) all combine to enhance children’s preferences for their own objects.

In addition, children seemed to understand that their special objects had value for them only in so far as they share a history with the object. That is, they did not attribute the researcher the same preference for the old (attachement) object. In this sense, they seem to understand the subjective nature of value.

The results are remarkable, among other things, because of the understanding of the abstract ownership relationships, the distinction between appearance and reality and the perspective-taking abilities involved in children’s responses. The authors also emphasize how attuned any child can be to minor features of an object that indicate that it is her unique object and not a substitute.

These findings also offer a different (experimental, cognitive) perspective on the phenomenon of “transitional objects,” first described by Donald Winnicott in the 1950s.

A remarkable study indeed.

Ekman on emotions

Ekman, P. (1984). Expression and the Nature of Emotion. In Approaches to emotion. http://doi.org/10.1017/CBO9781107415324.004

I plan to read and write more about emotions, as I am interested in the topic of self-possession vs. being possessed (or overwhelmed) by emotions. I wonder whether the use of ownership-related terms in this field is metaphorical, or rather points to a fundamental aspect of human experience: the fact that one must first possess oneself (one’s own body and actions) in order to possess other things. Many philosophers (Locke comes to mind, but also Hegel and Aristotle) have drawn this relationship between self-possession (or self-governance, being master of oneself) and personhood (being an agent in the world with the capacity to possess and own stuff).

In this article (a classic), Ekman distinguishes emotions from other reactions (mainly reflexes) and other affective phenomena, such as moods, emotional traits and affective disorders.

He also establishes 10 main characteristics of emotion:

  1. There is a distinctive pan-cultural signal for each emotion.
  2. There are distinctive, universal, facial expressions of emotion that can also be traced phylogenetically.
  3. Emotional expression involves multiple signals.
  4. The duration of emotion is limited.
  5. The timing of emotional expression reflects the details of a particular emotional experience.
  6. Emotional expression can be graded in intensity, reflecting variations in the strength of the subjective experience.
  7. Emotional expression can be totally inhibited.
  8. Emotional expressions can be convincingly simulated.
  9. Each emotion has pan-human commonalities in its elicitors.
  10. Each emotion has a pan-human pattern of the autonomous nervous system (ANS) and central nervous system (CNS) change.

 

 

 

Ownership in literature and clinical practice

Golden, A. (1997). Memoirs of a geisha: A novel. New York: Alfred A. Knopf.

I am constantly hunting for insights on ownership in everything I read. For instance, recently I finished reading “Memoirs of a Geisha,” and couldn’t help thinking about what it means to be a slave (the protagonist of this novel is sold to an “okiya,” when she is eight years old, to become a geisha). The protagonist of this novel is always struggling to find her own authentic path in life, to decide what kind of life she wants to lead, where she wants to live, who she wants to share her life to (family, friends, loved ones). But she’s not the owner of her own life.

This character reminds me about some of my clients who, while being apparently free, are not owners of their bodies and their destinies. Once I asked one of them what her main goal for the new year was, and she replied: “to be the owner of my life”. Another one, noticing that he worked too much and for other people, and that even his business was registered under his ex-wife’s name, told me: “I feel depersonalized.” For this patient, to overcome depersonalization, to become a person again, meant becoming the proprietor of his possessions again (his efforts, his time, his business, his possessions).