RE: query: "kinked" utility curves

["Dorman, Peter" <DormanP@xxxxxxxxxxxxx>]

Not having had a chance to look at Thaler's book, I can recommend two
general literatures: the discrepancy between willingness to pay (WTP) and
willingness to accept (WTA), and prospect theory, going back to the classic
article by Kahnemann & Tversky (1979).  In the second case, the undefined
reference point in K&T has mostly been associated with the status quo,
leading to "status quo bias", so this becomes another search string.

Peter

-----Original Message-----
From: Thad Williamson
To: pen-l@xxxxxxxxxxxxxxxxxxx
Sent: 19.06.01 12:33
>Subject: [PEN-L:13622] query: "kinked" utility curves

Hi Pen-Lrs,

Can anyone point me in the direction of an article or book that fleshes
out
the argument that individuals experience greater "disutility" in having
something taken away from them than they gain in "utility" when they get

something new, even if what they get is of the same monetary value?
(sorry
if that's not very clearly put.)

This seems like a useful point to make in talking about the true costs
of
unemployment, plant closure and job/income loss (especially if these
losses
are supposed to be justified by gains in welfare that supposedly accrue
to
others).  Any references would be much appreciated.

thanks,
Thad