The Moderating Effect of Relationship Norm Salience on Consumers' Loss Aversion: Figure 1

Abstract

People are said to be loss averse when their pain of losing something exceeds their joy of gaining it. This research proposes and tests a new moderator of loss aversion: the type of relationship norms salient at the time the loss or the gain is experienced. We suggest that mere salience of the norms of a communal relationship (based on concern for the partner) relative to those of an exchange relationship (based on quid pro quo) leads to a greater degree of loss aversion. A typical endowment effect study supports our overall thesis and shows that differences across relationship norms are stronger in selling prices (willingness to accept) than in buying prices (willingness to pay).