Advances in Economics, Management and Political Sciences

- The Open Access Proceedings Series for Conferences


Proceedings of the 2nd International Conference on Business and Policy Studies

Series Vol. 13 , 13 September 2023


Open Access | Article

The Influence of Endowment Effect on The Online C2C Commodity Market for Chinese International Students

Jiayu Sun * 1
1 Durham University

* Author to whom correspondence should be addressed.

Advances in Economics, Management and Political Sciences, Vol. 13, 59-75
Published 13 September 2023. © 2023 The Author(s). Published by EWA Publishing
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Citation Jiayu Sun. The Influence of Endowment Effect on The Online C2C Commodity Market for Chinese International Students. AEMPS (2023) Vol. 13: 59-75. DOI: 10.54254/2754-1169/13/20230673.

Abstract

In the online Consumer to Consumer (C2C) market for commodities, buyers and sellers have a propensity to value a commodity differently, resulting in disparate pricing expectations and a resulting dispute. In addition, it is debatable if the valuation difference still remains when purchasing and selling behavior occurs outside of C2C platforms. This study sought to determine the extent to which the endowment effect affects prices in the online C2C commodities market for overseas Chinese students. Using questionnaires to collect data, this study discovered a price disparity between buyers and sellers of pre-owned commodities. Nonetheless, it has been shown that it is doubtful whether ownership plays a major influence in the outcome, as no participant has stated that ownership is an essential aspect in determining pricing. This research concluded that buyers and sellers have different valuations. However, the extent to which it is purely owing to the endowment effect is debatable. Based on the findings, this study recommended that C2C platforms establish a "bridge" that helps both buyers and sellers better understand the other's perspective.

Keywords

the endowment effect, ownership, C2C market, pricing

References

1. Goddevrind, V., Schumacher, T., Seetharaman, R., & Spillecke, D. C2C e-commerce: Could a new business model sell more old goods? | McKinsey. https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/c2c-ecommerce-could-a-new-business-model-sell-more-old-goods (2021).

2. Kahneman, D., & Tversky, A. Prospect theory: An analysis of decision under risk. Experiments in Environmental Economics, 1, 143–172. https://doi.org/10.2307/1914185 (2018).

3. Mugge, R., Schoormans, J. P. L., & Schifferstein, H. N. J. PRODUCT ATTACHMENT: DESIGN STRATEGIES TO STIMULATE THE EMOTIONAL BONDING TO PRODUCTS. Product Experience, 425–440. https://doi.org/10.1016/B978-008045089-6.50020-4 (2008).

4. Leonard Lori. Attitude influencers in C2C e-commerce: Buying and selling. https://www.researchgate.net/publication/279712105_Attitude_influencers_in_C2C_e-commerce_Buying_and_selling (2012).

5. Ke Er, W. A Study on Relationship Between Customer Relationship Management (CRM) and Customer Satisfaction on Taobao Website in Johor Bahru. Journal of Arts & Social Sciences, 3, 1. (2020).

6. Garratt, R. J., Walker, M., & Wooders, J. Behavior in second-price auctions by highly experienced eBay buyers and sellers. Experimental Economics, 15(1), 44–57. https://doi.org/10.1007/s10683-011-9287-3 (2012).

7. AlSheikh, S. S., Shaalan, K., & Meziane, F. Consumers’Trust and Popularity of Negative Posts in Social Media: A Case Study on the integration between B2C and C2C Business Models. https://ieeexplore.ieee.org/stamp/stamp.jsp?tp=&arnumber=8256364 (2017).

8. Li, D., Li, J., & Lin, Z. Online consumer-to-consumer market in China-A comparative study of Taobao and eBay. https://doi.org/10.1016/j.elerap.2007.02.010 (2007).

9. Li, Q., & Liu, Z. Research on Chinese C2C E-Business Institution Trust Mechanism: case study on Taobao and Ebay(cn). https://ieeexplore.ieee.org/stamp/stamp.jsp?tp=&arnumber=4340712 (2007).

10. Yue, X., & Xie, J. Research on the consumer behavior in C2C market. https://ieeexplore.ieee.org/stamp/stamp.jsp?tp=&arnumber=6010852 (2011).

11. Yamamoto, H., Ishida, K., & Ohta, T. Modeling Reputation Management System on Online C2C Market. Computational & Mathematical Organization Theory, 10, 165–178. (2004).

12. Morewedge, C. K., & Giblin, C. E. Explanations of the endowment effect: An integrative review. In Trends in Cognitive Sciences (Vol. 19, Issue 6, pp. 339–348). Elsevier Ltd. https://doi.org/10.1016/j.tics.2015.04.004 (2015).

13. Boven, V., Dunning, D., & Loewenstein, G. Egocentric Empathy Gaps Between Owners and Buyers: Misperceptions of the Endowment Effect. Journal of Personality and Social Psychology, 79(1), 66–76. https://doi.org/10.1037/0022-3S14.79.1.66 (2000).

14. Kahneman, D., Knetsch, J. L., & Thaler, R. H. Anomalies: The Endowment Effect, Loss Aversion, and Status Quo Bias. Journal of Economic Perspectives, 5(1), 193–206. https://doi.org/10.1257/JEP.5.1.193 (1991).

15. Huck, S., Kirchsteiger, G., & Oechssler, J. Learning to Like What You Have – Explaining the Endowment Effect. The Economic Journal, 115(505), 689–702. https://doi.org/10.1111/J.1468-0297.2005.01015.X (2005).

16. Maddux, W. W., Yang, H., Falk, C., Adam, H., Adair, W., Endo, Y., Carmon, Z., & Heine, S. J. For whom is parting with possessions more painful? cultural differences in the endowment effect. Psychological Science, 21(12), 1910–1917. https://doi.org/10.1177/0956797610388818 (2010).

17. Shu, S. B., & Peck, J. Psychological ownership and affective reaction: Emotional attachment process variables and the endowment effect. Journal of Consumer Psychology, 21(4), 439–452. https://doi.org/10.1016/J.JCPS.2011.01.002 (2011).

18. Nägele, N., von Walter, B., Scharfenberger, P., Wentzel, D., & Scharfenberger philippscharfenberger, P. “‘Touching’” services: tangible objects create an emotional connection to services even before their first use. Business Research, 13, 741–766. https://doi.org/10.1007/s40685-020-00114-0 (2020).

19. van Boven, L., Loewenstein, G., & Dunning, D. Mispredicting the endowment effect:: Underestimation of owners’ selling prices by buyer’s agents. Journal of Economic Behavior & Organization, 51(3), 351–365. https://doi.org/10.1016/S0167-2681(02)00150-6 (2003).

20. Harris, C. Commerce Commission gets its day in court with ticket reseller Viagogo | Stuff.co.nz. https://www.stuff.co.nz/business/money/110351189/commerce-commission-gets-its-day-in-court-with-ticket-reseller-viagogo (2019).

21. Dirusso, D. J., Mudambi, S. M., & Schuff, D. Pricing strategy & practice Determinants of prices in an online marketplace. https://doi.org/10.1108/10610421111157946 (2011).

22. Irmak, C., Wakslak, C. J., & Trope, Y. Selling the forest, buying the trees: The effect of construal level on seller-buyer price discrepancy. Journal of Consumer Research, 40(2), 284–297. https://doi.org/10.1086/670020 (2013).

Data Availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License. Authors who publish this series agree to the following terms:

1. Authors retain copyright and grant the series right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows others to share the work with an acknowledgment of the work's authorship and initial publication in this series.

2. Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the series's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgment of its initial publication in this series.

3. Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See Open Access Instruction).

Volume Title
Proceedings of the 2nd International Conference on Business and Policy Studies
ISBN (Print)
978-1-915371-69-0
ISBN (Online)
978-1-915371-70-6
Published Date
13 September 2023
Series
Advances in Economics, Management and Political Sciences
ISSN (Print)
2754-1169
ISSN (Online)
2754-1177
DOI
10.54254/2754-1169/13/20230673
Copyright
© 2023 The Author(s)
Open Access
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited

Copyright © 2023 EWA Publishing. Unless Otherwise Stated