Richard Thaler, professor at the Booth School of Business, won the Nobel Prize for Economics this year. Thaler is known for his work on the “endowment effect.” Basically, It is the principle that people have a “divestiture aversion.” Or, in other words, people are unwilling to sell, or ascribe more value to things, merely because they already own them.
He and his colleagues ran an experiment in which they gave half the students in a class a mug for 22 cents. Then they told them to sell their mug to the other students if they wanted. Most would not sell, or they attributed a higher value than 22 cents to the mug they had just bought.
I heard a great interview the other day about the application of this theory: Bruce Springsteen tickets. Springsteen was playing, for a limited time, a 960-seat theater on Broadway. Tickets sold-out fast. A man, who got two tickets at face value ($400), was being interviewed about them.
The interviewer told the man tickets had gone for as much as $4,000, but the man wanted to keep the tickets and go to the show! He asked, “would you pay $4,000 for tickets?” “Of course not” was the quick reply. But, by keeping the tickets, that is exactly what he was doing, “buying” tickets and not getting $4,000 dollars.
Now, most of us would say, “that’s crazy, SELL!” But that is where endowment theory kicks in. You see, you don’t own them; he does.
Jesus once asked, ““For what is a man profited if he gains the whole world, and loses or forfeits himself?” Do you have a price for your soul? Would the pursuit of physical “happiness” cause you to sell? Less pain? Fame? Nothing is worth a soul.
Most of us could stand to get rid of some stuff. But no price is worth an eternal soul. That’s where a little divestiture aversion goes a long way!
At least one person would not sell tickets to see Bruce, at any price. Shouldn’t we refuse to sell tickets to be with Jesus forever?