Editing Endowment effect (section)

=== Greater sensitivity to market demands for sellers ===
Sellers may dictate a price based on the desires of multiple potential buyers, whereas buyers may consider their own taste. This can lead to differences between buying and selling prices because the market price is typically higher than one's idiosyncratic price estimate. According to this account, the endowment effect can be viewed as under-pricing for buyers compared to the market price; or over-pricing for sellers compared to their individual taste. Two recent lines of study support this argument. Weaver and Frederick (2012) <ref name=":1">{{cite journal |last1=Weaver |first1=R. |last2=Frederick |first2=S.|title= A Reference Price Theory of the Endowment Effect |journal=Journal of Marketing Research |date=2012 |volume=49 |issue=5 |pages=696–707 |doi=10.1509/jmr.09.0103 |s2cid=412119}}</ref> presented their participants with retail prices of products, and then asked them to specify either their buying or selling price for these products. The results revealed that sellers' valuations were closer to the known retail prices than those of buyers. A second line of studies is a meta-analysis of buying and selling of lotteries.<ref>{{cite journal |last1=Yechiam |first1=Eldad. |last2=Ashby |first2=Nathaniel J.S. |last3=Pachur |first3=Thorsten |title=Who's biased? A meta-analysis of buyer-seller differences in the pricing of risky prospects |journal=Psychological Bulletin |date=2017 |volume=143 |issue=5 |pages=543–563 |doi=10.1037/bul0000095 |pmid=28263644 |s2cid=33771796}}</ref> A review of over 30 empirical studies showed that selling prices were closer to the lottery's expected value, which is the normative price of the lottery: hence the endowment effect was consistent with buyers' tendency to under-price lotteries as compared to the normative price. One possible reason for this tendency of buyers to indicate lower prices is their risk aversion. By contrast, sellers may assume that the market is heterogeneous enough to include buyers with potential risk neutrality and therefore adjust their price closer to a risk neutral expected value.