Endowment Effect

We value things more simply because we own them — demanding far more to give something up than we would ever pay to acquire it.

• In Kahneman's mug experiment, people who received a mug demanded roughly twice as much to sell it as others were willing to pay to buy it.
• Homeowners consistently overvalue their houses compared to independent market assessments.
• Investors hold onto losing stocks far too long because selling feels like locking in a loss — the stock feels worth more because they own it.