Mine, mine, mine The Endowment Effect E-Reminders

Salam Alaikum brothers and sisters, welcome to another episode of our inward journey, where we are exploit a, we are exploring the mysteries of the human mind. So we can understand ourselves better. Because knowing yourself is one of the most important keys to a truly successful life. And a truly successful life is a life in which you are doing your deeds, with real sincerity for Allah subhanaw taala. And you're doing them in the correct way. And as I keep on mentioning, if you don't really know who you are, if you don't really know what motivates you, if you don't know why you think the way that you do, it's going to be very hard for you to be sincere. And it's something that I just

keep coming back to, is this great need for us to

be real with ourselves and have radical self honesty. It's so important, because we all do. And it doesn't matter. I don't think it matters. I'm sure there's some people who really work hard at this, what we're doing is hard work, because it is hard work. If you actually try it and apply the things that I've been talking about for the last couple of years in these reminders.

Yeah, it's hard work it is the inner work is hard work. But it's also amazing is fascinating. And you know, martial law, in the daytime, I often go walking in the hills, and I see the beautiful nature, the creation of our law. And then you know what, I come back and once a week, and a few days here and there as well. As I'm researching for each topic, I take another journey and inward journey that in many ways is equally fascinating, equally beautiful, and brings about so many different questions. And I'm always finding these incredible connections between what I'm finding out about the human mind about how our brains work, or, as we're really talking about how they don't work.

Sometimes this is what our conversation is about been about cognitive dissonance.

It's not, it's not really that your brain doesn't work actually, like, you know, these, these are very useful shortcuts that our brain takes, and for very good reasons.

And so and the good reason is that our brain takes a lot of energy, and living takes a lot of energy. And I think at the end of the day, what is really profound about today's discussion, mine, mine mine, the endowment effect, is thinking and reading about this subject. What I realized is that, and this is very true, definitely, it's true for me,

you need to find out whether it's true for you or not think about it, because this is why we have these discussions. So in Sharla, you can think and then you can understand, and you can see, how does this apply to me? How useful is this for me and my life? How much do I need to deal with this particular issue if it is an issue? So I definitely find that.

But it's, I definitely find that I do like to be in this state of rest.

And I think that in many ways, we're all looking for that state of rest a place maybe we can call home or a place that we feel relaxed and comfortable, and we feel secure, and we don't feel threatened. And when we reach that place

where I guess in many different ways we may have achieved some of our goals and some of our objectives. We are very, very reluctant to move.

And this is I think perhaps the sort of underlying basis of what we're going to be talking about today, which is the endowment effect mind. It's really this really, very, very normal, very understandable, but very strange phenomena is that when we have something, meaning when we possess something, it's in our hands here. We value that thing way, way more than it's actually worth

And of course, from the point of view of Economics, Psychology,

a lot of the things that I've been talking about, and I've realized

they are studies that are done from the viewpoint of what they believe the people who are studying it, they believe our rational, economic decisions, why do we make decisions that are not rational from an economic perspective?

A lot of the things that we have been discussing have a connection to economy. And again, another thing we're going to be discovering today, which is really fascinating, is how we are being manipulated by corporations, by businesses. And no, no, we probably do this ourselves in our own businesses, because we see others doing it. And we probably don't think that we're manipulating people. But we are being manipulated. And we are manipulating people using these cognitive biases. So it's always a good thing to understand. Why are we doing what we're doing? Am I really making a rational decision? Or am I just like a puppet and someone's playing with me? No, you don't want to

be a puppet. You don't want to be a sheep. You want to learn to think rationally independently. And so studying these things really helps. So this is it's interesting. I have a mug a nice mug of tea here. Because one of the experiments that was done around the endowment effect was based on mugs, it was all around mugs. So basically what they did is they got some groups of students and they gave some of the students mugs. And, and then they gave they didn't give they gave, they didn't give the other group of students have mugs, they had no mugs.

So then the students with mugs were told to know they had the mug right, it was given to them. So they were told to estimate the value of the mug. So students with mugs estimated the average on average average doubt they estimated the worth of their mug was like $7.99, like $8. Yeah, just under $8. Yeah. However, the students who had no mug

estimated the value of the mug as being about $2.79. Now,

only difference was

the possession, mine, it's mine. And because it was theirs, those people just thought it was worth way, way more than it actually was worth.

And yeah, this this is the endowment effects. And I think it takes place in all sorts of extraordinary things that I didn't read about because I've been thinking about it. Since I've been researching it. I wonder how many scientists, for example, come up with theories. And they have the endowment effect. They give way, way, way more weight to the theory that they have adopted than it's actually worth in real scientific terms. I wonder how many scientists do that and have the endowment effect in respect to their scientific leanings? That's very interesting, isn't it? Because science is supposed to be the most rational of pursuits. And I'm sure you will find that scientists just

like other human beings, when they have something and they think it's theirs. It's mine. They give it way, way more value than it actually has in the real marketplace, whether that's the physical economic marketplace, or it's the marketplace of ideas, or even by the way, the dating, bringing up dating, I know we Muslims don't date, but the point is, is still apply in terms of marriage and relationships. Lots of people stay in a relationship, not because it's rational, not because it's even necessarily healthy or good for them. Because once you're in a relationship, people are very, very reluctant to leave those relationships, which is not necessarily a bad thing. However, it's

also not necessarily irrational thing. And that's the point that the endowment effect comes into place in so many different parts of our life. This whole feeling that something is mine. So this is very interesting because obviously, as human beings, trade to Jara buying and selling is a very important part of human life. It's a part of our deen the Prophet sallallahu alayhi wa sallam. Of course, the Quran talks about trade, the Prophet sallallahu alayhi wa sallam before he was a messenger of Allah and afterwards he traded he boys, it's just a normal part of life. It's something Allah speaks about something the Prophet sallallahu alayhi wa sallam participated in and spoke about

and taught us

about rules of trade, and so on and so forth, this is normal. So really, when you study the endowment effect, when it comes to this issue of trade, there is always this tug and pull. And it happens in a lot of people is that you value something that you have way more than people are ready to buy it. Now, of course, everybody has a price. In the end, everybody has a price

at which they are ready to depart with whatever it is that they have. But this idea that it's mine, and it doesn't seem to matter. It's interesting, by the way, it doesn't seem to matter whether you are given that thing, won in a lottery,

or you work for it, and you, you know, you work through it with your hard earned sweat and labor.

The endowment effect is still there, even if the thing has been endowed to you, right, thus, the endowment effect. And I guess that's What's more surprising to psychologists is that when something was given to you almost for free, you still have that effect. You still overvalue something, even though you haven't really put any real effort into acquiring it. It's just the sheer fact of you possessing it, of you being the owner of it.

And even to a seat in aeroplanes. I mean, I was reading an article talking about the endowment effect. And it was very interesting that those are you You might remember this, I don't know if you remember, but there was this. This doctor who was I think, from South Korea, he had originally American but his originally South Korean, in an aeroplane in I don't know which American Airlines or whatever that shares fell by 1 billion anything overnight when this video was released. So it was something big. So basically, what happened is the police forcibly removed him from his seat in the aeroplane. And he actually got injured in the process. And he said, he's a doctor. Right? And all

because, or Northwest Airlines or American wear, I don't know, whatever. I don't know, start naming some airline who it wasn't. But it's some American Airlines. Yeah.

I'm sure you can Google it and find out. Yeah, they just wanted their staff, their staff needed seats on the airplane. So they chuck some passenger this passenger out.

And

the whole point is, it's the endowment effect taking place. Because it like, once he was in the seat, and that was the point, he gave this seat, or this way more value than it really had, because obviously he did puts up some sort of resistance and some sort of, you know, he did really not want to move, which is perfectly understandable. I mean, if you think about trudging through an airport, the fact that we're probably gonna have to wait, what, wait another six hours for another flight, or however long it is, you're in your seat, you're there, you're ready to go. And then someone tells you to move. I think that really, in a sense, goes back to what I was saying. That the fact that we

as human beings, we like that place of rest, we like that feeling of it's mine. We like that feeling of possessing something because with it comes a sense of security. It's comes a sense of completeness. You know, it's something we're always looking for. And what was remarkable is, I was thinking about traveling, and I was thinking about that doctor sitting in his seat, and he plunked himself down, he was just sort of relaxed and sort of thought, yeah, and it's the same thing. When you buy something, or even when you're given something, it's just that feeling that comes with it. And this is the whole point. The whole point is this is actually very emotional. It's not logical,

it's not rational. It's emotional. And that's what it's about is the fact that we invest our emotions into things, we invest our ego into things. It's almost as if those things become a part of our selves. And therefore, just as we defend ourselves, we defend those things. Again, this is understandable. And this is something natural. This is the natural order of things to some degree. Otherwise, why would there be punishments for theft? Because it's not right for someone to deprive another human being of something that they have worked for, or even something which they have been given. It's not the right of a human being to deprive another human being of something that belongs

to them. It's not right. Okay.

Except under some very, very extreme and particular and limited circumstances.

And this is something universally understood. So obviously,

even in Islam is good for you to stand up for yourself, it's good for you to defend yourself against those people who would wrongly deprive you of what belongs to you. However,

we can see that this attitude of something is mine, something belongs to me, on the other hand,

can get in the way of making rational decisions. And it's interesting that when the Prophet sallallahu alayhi wa sallam talked about, if a thief comes and tries to take something from you, you shouldn't give it to him. And if he fights you fight him back. And if he kills you, He will go to hell. And if you know if you, if you kill him, he will go to hell. And if he kills you, you will die or shaheed. So there is something there that that it is something that is a religious virtue, it is a virtue in Islam, to defend yourself vigorously against people who are unjustly seeking to to, to deprive you of your wealth, or attack your family or your home. This is normal. However,

on the other hand, is this attitude? Is this mindset of mind, mind mind? Is that really a correct mindset to have as a Muslim? And this is what I want to think about? Because I'm also thinking about, what are the different ways that we might be able to deal with this endowment effect this thing that can really warp the way we think about the value of things just merely by the virtue of having it and possessing it, we give it weigh me way more value, than it actually really is worth? And, and so obviously, we buy and sell. So if everyone has this endowment effect with an absolutely, it's mine, I'm never going to get rid of it, then obviously, no one would sell anything. Obviously,

no one said anything. You know, like, if I wanted to sell, you know, you wanted to buy this mug of me, if I if the domino effect was absolute, without limits, then I would never let go of it. Right? However much you offered to pay me for it, but like I said, everyone has a price. Right? And but it's just that What do we do is we over estimate the value, we overestimate, which is a problem. Because if I am insisting that this thing that I have is worth way, way, way more than what you are prepared to pay for it.

I'm not gonna say anything.

And then trade would not exist. So I mean, fortunately, obviously, people do are able to think about these things, rationally, people are able to overcome the endowment effect, people are able to sell things at a price that people are ready to pay for it. And obviously, that has to come with some training with some discipline.

And that's what it's about, it's about being able to think about things in a rational way. And to think about what is the worth of something in a rational way. And obviously, a lot of people are not able to do that. Like I said, brothers and sisters, this is not just about buying and selling things, this can be

in many, many different aspects of human activity as well. So yes, so how can we deal with this how I think Subhanallah as always, we come back to our beautiful Deen of Islam, this beautiful religion. And I've been thinking about some of the ways just by virtue of being a Muslim, just by virtue of our belief that we have about Allah, about this life, about the reality of the nature of this world, about the life to come about some of the practices, the religious practices that we have, as Muslims help us overcome this self possessive egotistical belief that things belong to me. And that will actually help us deal with the world and reality and other people in a much more sensible and

approachable way. So number one, is our belief in Allah, that Allah is the Creator. And Allah is the provider. And Allah is the Owner of everything, every nothing really belongs to you anyway, brothers and sisters, nothing. It actually belongs to Allah Subhana Allah and Allah has inch

I said it to you, to see how you and to see how I will behave to see what will we do with these things? How will we use these things? Will we use them in a way that is pleasing to Allah or not? That's the reality. So even our children, I guess, we think of our children as ours. And of course, we have that responsibility. Parents have the primary responsibility for children, not government's, not schools, not big pharma, right? You the parent, you have the primary responsibility for your children. And no one should be taking that away from parents, whatever their assessment of those parents are, unless I get it unless we have extreme extreme circumstances of, of absolute clear

abuse, obviously, children should be shaved, saved from, you know, abusive parents, step parents or whatever, right. Okay. Just as people should be saved from oppressive and tyrannical governments in Sharla. But the point being brothers and sisters, in the normal process, the normal way, the normal nature of things is that parents have that responsibility. But children don't belong to you. They're not actually yours, really, they are a gift. They are a blessing that Allah has given you. And yes, your children are there for you to invest in and to utilize and Insha Allah, you will hope that they will be a source of goodness for you in this life, and in the next. But always remember that

whatever you have, whatever you possess, and you think it's yours, it's not really yours, even your health, even your life, that is why suicide is haram.

Because it's not your life to take away. It's not for you to do that. And when you take that upon yourself and you end your life,

then that is something that Allah will punish you for extremely severely, because you took it upon yourself to end something that was ALLAH had not given you have the permission, or the wherewithal or the the allowance to do that. But you took it upon yourself to do that. Obviously, Allah has given us this freedom in order to obey Him or disobey Him. If we couldn't end our lives, that freedom, in a sense will be meaningless, right? So it doesn't mean Subhanallah Yes, Allah, this is another example. Even your life, your health, your health. Subhanallah this is something many of us need to think deeply about our health. And it is something that Allah will ask us about on the Day

of Judgment, you need to make an effort to look after your health, you must brothers and sisters, right?

And because that's something that when we stand in front of Allah subhanaw taala, Allah will ask us, Well, your life and what you did with it, your health and how you cared for it. So how you look after your health is something that you will be accountable for, because it again is a gift that Allah has given you. So again, even these things you can't think of themselves, you even these things, you can't think of them as being your yours per se. Right. So this idea of ownership is in itself something that is in some ways, antithetical to how we should be as believers. But this is our nature, as Allah says in the Quran, beautified just giving you the meaning. In surah baqarah

beautified in the hearts of men

is land and gold, and well tilled land and golden businesses and your your, your your children and the horses. I'm just giving the gist. I don't remember exactly. But this is the general gist of the idea that Allah has made these things. We love these things. You see our hearts feel love for it. Yes. So we have this attachment to those things. But of course in the end of the day, Subhan Allah, this is just a gift from Allah. And so this is part of our Aikido is part of our belief also we realized this world is nothing this world is worthless, as the Prophet sallallahu alayhi wa sallam said that, you know, he told us that if there were if the if this world and everything it contains

was worth even the wing of a mosquito, the wing of a mosquito, the most pesky troublesome

annoying insects right Subhanallah that kills more human beings than Corona or anything else. Yeah. Yes, malaria, the mosquito. The whole world is not worth the wing of a mosquito in the sight of Allah. It's so worthless if it had even the weight of that wing of that mosquito. If it had the value of even that much in the sight of Allah, he would not have let those rebellious people who disbelieve and rebel against him, you would not even have let them drink water.

This is to meet you think this world for Allah is nothing as the Prophet sallallahu alayhi wa sallam he was walking with combat his companions they came across the rotting carcass of a dead goat. He said Who Would Buy This for me for their hammer denaro with the smallest amount of money? They said, Yeah, Rasul Allah, we wouldn't buy it for even if it was alive. We wouldn't buy it for that much, but it's dead. What use do we have for it? The Prophet said, this world in Allah sight is more worthless than this rotting carcass is in your sight.

You see, brothers and sisters have a lot. So why do we attach so much worth to this world? That's another thing to make us realize that in reality, we should not give that much worth to things of this world. Even when the thief is coming to steal from us. It's not because of the worth of that thing. It's because of the need for order. It's for the need for justice is because we need to fight against tyranny and oppression and injustice and wrongdoing. And because a fundamental part of our deen and being a Muslim is enjoying what is right and forbidding what is wrong? Yes, this is what is it's about. It's not because we really care about these positions. Allah is the provider Allah is a

result he will provide for us Subhanallah it's not about hanging on to the possession because it's yours. That's not fundamentally what it's about. I don't believe that. I think the issue is the issue of standing up against injustice and wrongdoing and tyranny and thuggery. That is something that we should have as a value system for ourselves. That's how we live civilized lives, when we stand up against wrongdoing. So that's the reason why, as for this world, what is this world we just here for a passing moment? Brothers and sisters? So how are we so attached to the world and the things of these world? These are the things that we need to remind ourselves about the ACA, as the

Prophet said, you know, if you took a un How is that if you took a, a needle, and you dipped it in the sea, and you see how much water is left on the needle, that is like the life in this world? What's left on the needle, and the ocean? is like the

scene SubhanAllah? So, what is this world? What is this life just a passing moment? Just like a traveler who takes shade and the rest underneath the shade of the tree, then we're on our journey on our way. These are things that will help us deal with the, you know, the endowment effect and other similar things like that. Okay, because actually many of these things, okay, so and the other thing practically, is a cat, obviously, is a cat is a reminder that this wealth is something that Allah has given you, and other people have a right to emit a certain amount they have a right, and that this is there to purify you of your stinginess, and to remind you that who gave you this wealth? So

these are some practical things in Islam. Finally, I want to talk about some things where where is it that we find the endowment effect is used to manipulate you? Okay? Well, anything that makes you feel even for a moment that something belongs to you, they are using the endowment effect in order to manipulate you to purchase and to hang on to that product. So test driving a car, yes, test driving a car. One of the reasons why Apple

they have these big stores everywhere, and they are told their sales team, you can go and play around on their

healer their products for as long as you like. And their staff are told not to intervene not to interrupt except to encourage you to make a purchase. Because why that's the endowment effect because the more time you spend with it, the more time it's in your hand, the more you feel it belongs to you and the less you want to let it go. Yes, that's the whole thing with a 30 day free trial. Try this mattress for free in your home. If you're not 100% satisfied, you can return it after 60 days. They are relying on the endowment effect that once you have something in your possession, you are you're very in an inclined

To get rid of it, especially obviously, if the products just rubbish, the endowment effect is probably not going to, you know, save you as a seller. But certainly in a competitive market, that's it. Why are we so reluctant to change our energy suppliers? Why are we so reluctant often to change our mobile phone suppliers? Why is the endowment effect with like, it's not I, when I was thinking about it, maybe the endowment effect doesn't describe it properly. I think it just comes to that thing that I talked about that feeling of the guy sitting in his airplane seat, you know?

No, okay. Relax. That's the same thing. Oh, yeah, I got my, you know, I've got my gas sorted my electricity. So in someone comes, I can give it to you cheaper? It's like, Dude, I just, you know, sign the things I did that this and that I can save you a third on your bills. It's quite a lot of money. Right?

But you know, what, you're just comfortable where you are? This is normal. We want to feel comfortable. It's not rational, though. Actually, really? Why would you want to waste money? It doesn't make any, it's not that much of a hassle. But anyway, this is this is the endowment effects. And this is how it's used. So anything like that, right? Where they have a 30 day free trial,

where they get user trial product, try before you buy, you know, anything like that. Oh, one final thing. Maybe you could use the endowment effect, as and I think we've started some people who used it in doubt. If not, I'm not suggesting 100% I don't think anyone did this. Thinking that this was an idea in order to get people to be Muslim. I don't think they ever imagined that, but it is actually the endowment effect, you know, that try on the hijab thing. You know, the try on the hijab, Hijab Day, or, you know, the Ramadan foster day of Ramadan.

Yeah, even come and visit the mosque. These, you know, these are actually really good ways of getting people to feel comfortable, because you know, what, once they've got the hijab on, they might like it. Once they start fasting. They say, You know what, this is really good. They come to the mosque, and this feel the vibe in the mosque is like, yeah, I feel at home here. Okay, so this, this is actually a really, really good way of making people feel comfortable making them feel I'm home. Yeah, this is, this is where I belong. This is mine. Yeah, I feel good. I don't really want to leave here. That's, isn't that how we should make people feel as Muslims? Shouldn't we make them

feel you've, you've come home, this is your home. This is where you should be. This is your nature. This is your fifth row.

This is the place we all need to return to. This is how we need to make people feel brothers and sisters, right? Yes, this is how we need to make people feel. Please think about that. Especially Muslims living in non Muslim lands. Do you think our mosques are places where an Englishman would walk in and feel this is home? I feel I belong here? Or something very, very different? Do we even let them in almost do even encourage them to come to the mosque? Unfortunately, not enough. So brothers and sisters.

This is a very, very interesting topic that we've just discussed about

how let's just remind ourselves, why it is irrational. What is the problem with it? Is because when we have something in opposition, when we have something in our possession, we imagine that it has a lot more value than its real value, I want you to see and think about how you have the endowment effect existing in your life in whatever aspects of life it may be your job, your relationship, things that you own things that you possess things that you should sell, want to sell, but you're not doing it, or many different areas, ideas that you have maybe, right? There's so many different things, and why not look out for different ways in which people are manipulating you emotionally and

psychologically, to get you to buy their products, even though it may not be the most rational choice, or they may be trying to get you to buy into their ideas or follow their system.

Right? Because it's not only things that you buy, it's ideas that we adopt, right? It's environments in which we live. Oh,

All of this comes under that topic. Fascinating. Isn't it amazing? The human mind Subhanallah brothers and sisters has been a pleasure. Until next week, inshallah we'll have a look through your comments because I'm too focused on talking to you. I haven't even put my eyes down on my computer screen to see the comments that you've been making. So I apologize for those of you who have been making comments and asking questions I've I was so absorbed in this fascinating subject. Until next time, brothers and sisters May Allah bless you May Allah guide you, May Allah help you to know yourself so that you can worship Allah even better. Allahumma Salli ala Muhammad, Allah Allah He was

secondary you are Salam. Oh, and don't forget to share if you enjoyed this video, and to like and subscribe, until next time Salam alaykum Warahmatullahi Wabarakatuh