Why we love to hoard… and how you can overcome it
(Copyright: Thinkstock)
Understanding the psychology behind why we like to accumulate all
manner of items can in fact help you to lead a clutter-free life.
Question: How do you make something instantly twice as expensive?
Answer: By thinking about giving it away.
This
might sound like a nonsensical riddle, but if you've ever felt overly
possessive about your regular parking space, your pen, or your Star Wars
box sets, then you're experiencing some elements behind the psychology
of ownership. Our brains tell us that we value something merely because
it is a thing we have.
This riddle actually describes a phenomenon
called the Endowment Effect. The parking space, the pen and the DVDs
are probably the same as many others, but they're special to you.
Special because in some way they are yours.
You can see how the
endowment effect escalates – how else can you explain the boxes of
cassette tapes, shoes or mobile phones that fill several shelves of your
room… or even several rooms?
No trade
To put a scientific lens on what's going on here, a team led by psychologist Daniel Kahneman carried out
a simple experiment.
They took a class of ordinary University students and gave half of them
a University-crested mug, the other half received $6 – the nominal cost
of the mug.
Classic economics states that the students should
begin to trade with each other. The people who were given cash but liked
mugs should swop some of their cash a mug, and some of the people who
were given mugs should swop their mugs for some cash. This, economic
theory says, is how prices emerge – the interactions of all buyers and
sellers finds the ideal price of goods. The price – in this case, of
mugs – will be a perfect balance between the desires of people who want a
mug and have cash, and the people who want cash and have a mug.
But economic theory lost out to psychology. Hardly any students traded.
Those with mugs tended to keep them, asking on average for more than $5
to give up their mug. Those without mugs didn't want to trade at this
price, being only willing to spend an average of around $2.50 to
purchase a mug.
Remember that the mugs were distributed at
random. It would be weird if, by chance, all the “mug-lovers” ended up
with mugs, and the “mug-haters” ended up without. Something else must be
going on to explain the lack of trading. It seems the only way to
understand the high-value placed on the mugs by people who were given
one at random is if the simple act of being given a mug makes you value
it twice as highly as before.
This is the endowment effect, and
it is the reason why things reach a higher price at auctions – because
people become attached to the thing they're bidding for, experiencing a
premature sense of ownership that pushes them to bid more than they
would otherwise. It is also why car dealers want you to test drive the
car, encouraging you in everyway to think about what it would be like to
possess the car. The endowment effect is so strong that even imagined
ownership can increase the value of something.
Breaking habits
The
endowment effect is a reflection of a general bias in human psychology
to favour the way things are, rather than the way they could be. I call
this status quo bias, and we can see reflections of it in the strength
of habits that guide our behavior, in the preference we have for the
familiar over the strange or the advantage the incumbent politician has
over a challenger.
Knowing the powerful influence that possession
has on our psychology, I take a simple step to counteract it. I try to
use my knowledge of the endowment effect to help me de-clutter my life.
Perhaps this can be useful to you too.
Say I am cleaning out my stuff. Before I learnt about the endowment
effect I would go through my things one by one and try to make a
decision on what to do with it. Quite reasonably, I would ask myself
whether I should throw this away. At this point, although I didn't have a
name for it, the endowment effect would begin to work its magic,
leading me to generate all sorts of reasons why I should keep an item
based on a mistaken estimate of how valuable I found it. After hours of
tidying I would have kept everything, including the 300 hundred rubber
bands (they might be useful one day), the birthday card from two years
ago (given to me by my mother) and the obscure computer cable (it was
expensive).
Now, knowing the power of the bias, for each item I
ask myself a simple question: If I didn't have this, how much effort
would I put in to obtain it? And then more often or not I throw it away,
concluding that if I didn't have it, I wouldn't want this.
Let
this anti-endowment effect technique perform its magic for you, and you
too will soon be joyously throwing away things that you only think you
want, but actually wouldn't trouble yourself to acquire if you didn't
have them.
And here’s the thing… it works for emails too. If
someone sends me a link to an article or funny picture, I don't think "I
must look at that", I ask "If I hadn't just been sent this link, how
hard would I endeavour to find out this information for myself?". And
then I delete the email, thinking that however fascinating that article
on the London sewerage system sounds or that funny picture of a cat
promises to be, I didn't want them before the email was in my
possession, so I probably don't really want them now.
That’s my tip for managing my clutter. If you have any others, let me know.
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