# Endowment Effect
The endowment effect is a result in behavioral economical that people are more likely to retain an object they own than acquire that same object when they do not own it. It is a cognitive distortion in which the perceived [value](value.md) of an [asset](assets.md) is biased by the act of owning it and ties into the psychological phenomenon of loss aversion. Instead of objectively valuing the [asset](asset.md), independent of their holdings, the individual will overvalue assets they currently hold.

## References
1. Plott, Charles R., and Kathryn Zeiler. "Exchange asymmetries incorrectly interpreted as evidence of endowment effect theory and prospect theory?." American Economic Review 97, no. 4 (2007): 1449-1466.
1. Leibenstein, Harvey. "Bandwagon, snob, and Veblen effects in the theory of consumers' demand." The quarterly journal of economics 64, no. 2 (1950): 183-207.