Work detail

Value of Accounts at Free Social Networks and the Endowment Effect

Author: Bc. Martina Čepová
Year: 2015 - summer
Leaders: PhDr. Lubomír Cingl Ph.D.
Work type: Bachelors
Language: Slovak
Pages: 49
Awards and prizes:
Abstract: In behavioral economics, the endowment effect explains the difference between the
stated value of the good that consumer already owns and the value of the good what
he would be willing to pay to obtain it. On the basis of neoclassical economics, the
value of one's willingness to pay (WTP) and willingness to accept to forgo it (WTA)
should be equal. In practice the values differ and the difference has been
demonstrated by many experimental studies on various types of goods. The core of
this thesis is to verify the existence of the endowment effect for non-market goods,
the account at free social network website Facebook, by the analysis of the
relationship between WTA and WTP. Because of nonexistence of the market, the
individual does not have any market experience with respect to economic valuation of
the account. An economic evaluation study by the Contingent Valuation Method is
designed. In the last part I analyze the variables which have impact on the stated




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