The Endowment Effect and other Biases in Creative Goods Transactions

Abstract

The Endowment Effect, which has been observed to occur when the ownership of a good leads the consumer/owner to value the good more than its market value, has been described as a manifest gap between the willingness to accept (WTA) and the willingness to pay (WTP) in a variety of forms of property transactions. The paper traces the development of endowment effect research, its entrance into IP and Copyright research and suggests further research that may enhance the existing understanding of the effect and the mechanisms at work in value formation in creative works.