Endowment Effect: Experimental Tests and Literature Study

In everyday economic life, the endowment effect is a very frequent occurrence. It describes phenomena wherein person values possession more highly when they own it than do not. At present, psychological mechanism of this phenomenon mainly explained by loss aversion, but theory has great defects. A theoretical area behavioral finance effect. order to analyze traits financial market subjects (decision-makers) in behavior and study investor decision-making its effects on asset pricing, field founded theories behavior, finance, sociology, economics, decision-making, psychology. questions conventional economics. The contradicts rational hypothesis economics accurately represents research techniques finance. Future can combine psychology further explore phenomenon. Combined with influence Coase theorem, practical significance