Endowment and Contrast Effects in Judgements of Well-being
Author(s)
Tversky, Amos; Griffin, Dale
Abstract
The present alone may not provide enough information to define happiness without reference to the past. Yet memories have a complex effect on our current sense of well-being. They represent a direct source of happiness or unhappiness, and they also affect the criteria by which current events are evaluated. In other words salient hedonic event (positive or negative) influences later evaluations of well-being in two ways: through an endowment effect and a contrast effect. The author suggests that the hedonistic impact of an even reflects a balance of its endowment and contrast effects. The article explores some descriptive and prescriptive implications of this notion.
