A new study has suggested that 'Endowment Effect'- the mere fact of possessing something raises its value to its owner- is not found in modern hunter-gatherer societies.
Centuries of economic theory have been based on one simple premise: when given a choice between two items, people make the rational decision and select the one they value more. But as with many simple premises, this one has a flaw in that it is demonstrably untrue.
A new interdisciplinary study from the University of Pennsylvania has delved into whether this bias is truly universal, and whether it might have been present in humanity's evolutionary past.
"We wanted to examine whether the endowment effect was something that occurs in non-WEIRD societies, since they represent the vast majority of human populations that have ever existed," Coren Apicella, study's lead researcher, said.
"Even if it's not a perfect window into our past, it's at least a different perspective than what you get when you study your average college student. The fact that the Hadza remain relatively isolated from Western culture, media and ideals makes them a good group with which to investigate the history and universality of biases like the endowment effect," the researcher said.
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The history of the endowment effect is of particular interest to evolutionary psychologists, as experiments to test its presence in non-human primates, such as orangutans, chimpanzees and gorillas, has been met with mixed results.
That some non-human primates exhibit the bias could mean that it was present in the last common ancestor between them and humans, but it could also mean that they learned the behaviour by participating in other reward-based studies.
The area of North Tanzania where the Hadza live provided a natural way to further investigate the role of culture in transmitting this bias, as a large lake separates some, but not all, of the camps from a nearby village.
Apicella said that they wanted to use both food and tools, as experiments with non-human primates show an endowment effect for the former but not the latter.
The researchers that it didn't make a difference whether a person was choosing between cookies or lighters. The difference-maker was their relative level of isolation from modern life.
The study will be published in the American Economic Review.
