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Given the situation below, can someone help me identify/name the logical phenomenon?

So I own a laptop that I don’t use…. Someone has offered me £1000 dollars for it but I decided not to sell it. I myself would NOT pay £1000 dollars for it… I feel like there’s some kind of illogical behaviour going on here because me not selling it for £1000 is financially equivalent to me buying it for $1000. I think in both cases I’m giving up £1000 for a laptop. Do you guys know if there a word/name for this?

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The discrepancy between WTP and WTA is known as the endowment effect, and this has been extensively studied in behavioral economics.

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  • $\begingroup$ This is not correct. The endowment effect is merely one possible explanation for any WTP-WTA gap. $\endgroup$ – Kenny LJ Sep 24 at 0:50
  • $\begingroup$ @KennyLJ: The endowment effect is an effect, an empirical regularity, not an explanation of something else. Rather the endowment effect itself is to be explained because of its anomalous nature. The terminology is standard in behavioral and experimental economics literature. $\endgroup$ – Herr K. Sep 24 at 2:03
  • $\begingroup$ See for example Brown (2005), Section 2, which lists the endowment effect as merely one of five "Plausible reasons for the disparity". $\endgroup$ – Kenny LJ Sep 24 at 2:16
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    $\begingroup$ @KennyLJ: Perhaps we ought to refer back to the author who first coined and then popularized the term endowment effect: Thaler et al. (1991) use the term to refer to "the fact that people often demand much more to give up an object than they would be willing to pay to acquire it". This description as well as the wine example given in that paper closely resembles OP's laptop example. The JEP paper also explicitly says that endowment effect "can be explained by a notion of loss aversion" (p.199). $\endgroup$ – Herr K. Sep 24 at 5:47
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    $\begingroup$ Dhami (2016), a textbook that is arguably the counterpart of MWG for the field of behavioral economics, has a subsection (3.2) devoted to outlining how loss aversion causes the endowment effect, rather than the other way around. The same direction of explanation can also be found in Ericson & Duster (2014, NBER WP). $\endgroup$ – Herr K. Sep 24 at 6:16
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WTP-WTA gap/discrepancy/disparity. (WTP = Willingness-to-pay, WTA = Willingness-to-accept.)

(There's a fairly large literature on this. Search "WTA WTP" on Google or Google Scholar and you'll find many papers.)

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