The IKEA effect explained in less than 9 minutes (Behavioral Economics)

Can you think of examples of the IKEA effect in your life? Let me know in a comment below!
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Main sources of information for this video:
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en.wikipedia.o...
Clips of Daniel Mochon from NPR link here: www.npr.org/20...
If you want more information on the IKEA effect, probably best to read ‘Alchemy’ By Rory Sutherland. He has a great example in his book where he talks about how he used the Ikea effect to get people to wash their clothes better. Great read.
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Thanks for watching! 😊

[@anonl5877]

As a Linux user, i see this and now I understand why certain people really like Arch and Gentoo. They don't offer significant benefits over other distros, but they are much harder to setup and maintain, so the users take more pride in them.

[@dancoutts1531]

Such a good video . You deserve a lot more recognition . Thanks!

[@PeteJudo1]

Thanks Dan, I really appreciate the support!

[@andysadventures3910]

Another really interesting video on human behaviour. Thanks for all the time and effort you put into these presentations. FWIW I think you have the format and duration spot on.

[@PeteJudo1]

Glad you enjoy them! Thanks!

[@chriswixtrom6514]

Thank you for a glimpse into the fascinating psychology behind all this!

[@devikakarora3124]

This video explained the IKEA effect so well. Thank you

[@PeteJudo1]

You’re welcome! Thanks for watching!

[@whalienreader1261]

Love these videos! You deserve waaayyy more subscribers

[@PeteJudo1]

Thank you! 😁

[@najwiekszyzpolakuw5931]

True

[@amadous.5670]

I am about to start working on a Doctorate of business administration and I have been wanting to research an evolving side of behaviour economics. I think you might have unintentionally touched on something very interesting that can be linked to new technologies (I know this is not your work per sei but your summary and presentation definitely sparked an idea in my mind). Great work!

[@PeteJudo1]

I’m glad! Hope you do amazing work!

[@takiyaazrin7562]

In technology commercialization they call this phenomenon nigh

[@javiernavas8169]

Well explained!Thanks Pete for sharing!

[@saptarshidas3911]

I am learning bits by bits and new concepts which is helping me to understand what behavioural economics does and how it does it. It will be very much appreciated if you can put a video on which universities can I apply in coming days for my graduate studies in this field.

[@aussie8114]

I will explain IKEA in one word... Meatballs.

[@PeteJudo1]

Hahahaha. Better job than me mate!

[@takiyaazrin7562]

❤

[@mayarismayani5396]

Thank you! it's really open my mind.

[@jakesmith5699]

i really appreciate your content!! glad i have found it!

[@PeteJudo1]

Thanks Jake!

[@takiyaazrin7562]

Great. I think this is one of few Dan Ariely reliable studies

[@nararabbit1]

I thought immediately of home renovations. People think their personal design is worth way more than it is to any outside buyer leading to unrealistic expectations by sellers who did a lot of work on their homes themselves.

[@PeteJudo1]

Great example!

[@vojtaborsky]

another perfect vid, you earned one more subscriber 😊👍

[@andrewrobertson6472]

Great video and well edited and presented

[@PeteJudo1]

Thank you very much!

[@ALEXLAD94]

Interesting content and well made videos - in before 1 mil views on your vids :) Keep it up, mate!

[@PeteJudo1]

Thanks! If that ever happens I’ll explode I think 😂

[@petermohamed-h8v]

Great presentation. Thank youm

[@kiryoungryu8250]

You explain it very easy to understand. 👍 It is very interesting to consider how this method applying other business. 😊

[@PeteJudo1]

Indeed!

[@Dani-ICU-RN]

OMG.TY..NOW I GET why I could not help being the Nurse I WAS in ICU..that was MY PATIENT , For 13 hours..and others were just there to do THEIR JOB . The extra lil stuff they shamed me for doing( making family member coffee at 2 am, painting a lil dying elderly ladys toes, b/c she WISHED SHED" had pedicured feet for her funeral..." ...

[@GGTanguera]

That's why parents value their children more than others. IKEA effect :)

[@nararabbit1]

That guy picking up a whole cake slice from the slide and then biting it in the middle is uncomfortable to watch! Haha.

[@PeteJudo1]

It was a huge slice!

[@elk3407]

I have a few problems with the Ikea effect. The foundational idea the labor leads to love is flawed. It doesn't apply to all stages of learning a skill, and only really considers the first "unconscious incomitance" stage and occasionally the last "unconscious competence" stage. When in the middle stages, labor can lead to hate and disappointment in the product and the entire theory of the ikea effect breaks apart.

[@PeteJudo1]

Thanks for this comment. Definitely doesn’t seem to work in all contexts. I think a key component to think about is that you have to be successful in building the thing yourself for it to work. If you fail or only get part way, then you kind of have a reverse ikea effect and feel that hate and disappointment that you talk about. I think understanding that distinction can help tease out some of the flaws you say.

[@lavendersingh4214]

Hi Petes, Isn’t it somehow similar to sunk cost effects? Instead of money we’re putting in our labour. Looking forward to hearing your thoughts. I really appreciate your efforts and the way you explain things easily deserves much respect. Keep going.

[@PeteJudo1]

Yes it’s definitely related! But the Ikea effect adds an extra layer on top of sunk cost. Sunk costs are just to do with resources invested, but the Ikea effect adds the layer that you gain greater satisfaction when you successfully make something. The evidence for this is that we don’t observe the IKEA effect when the construction was not completed, despite labour being invested already.

[@itchynail]

people liked to add eggs and milk to mix because they believed its more tasty and more natural. The question is why people stopped cooking themselves and eat at diners now?

[@dantebruno]

I'm wondering if this relates or intersects with the endowment effect? With the origami example, I could see how folding the paper yourself might feel like it is "mine" more than the alternative which would make it more valuable. Then again, if I just buy couch vs buy and build a couch, I would own it in both cases... so maybe not? In any case, love the vids!

[@PeteJudo1]

Yes it definitely does. But the distinction is important and I think you touched on it already. With the Ikea effect it’s about the sense of accomplishment you feel when you successfully make something. With the endowment it’s about the fear of losing what you already have!

[@EvaLasta]

You have such a unique accent I thought it was an Irish accent but then I saw that you are from Wales

[@PeteJudo1]

Sure am!

[@azirtube6512]

As a Software QA, I am constantly fighting against Software Devs because of the IKEA effect they have about the work they have made. Thankfully now after this video, I have a nice non offensive phrase (the IKEA effect) to describe their irrational delusions about the absolute garbage they come up with 🤣

[@PeteJudo1]

Hahahha! Makes sense!

[@takiyaazrin7562]

In technology commercialization they call this phenomenon NIH

[@surakshavegad2431]

Another amazing video of Human behavior. 👏 Could that also be implied to the people who has the Persistent Trait (value differentiation)

[@PeteJudo1]

Yes persistence is so important! Completion leads to competence, which leads to the IKEA effect!

[@benstinson7006]

Gun enthusiasts who "build" (assemble, actually) their own custom rifles (think AR-15) overvalue the finished product relative to what others would pay for it if it were sold already assembled, as a package deal.

[@PeteJudo1]

Love that example! Thanks Ben!

[@mshibinz]

Dude....do such case studies please 🙏 Do a case study on Gymshark too...the t shirt you are wearing 😀

[@PeteJudo1]

Hahaha maybe i will!

[@ategateg20]

great video. thank you

[@PeteJudo1]

You’re welcome!

[@Dani-ICU-RN]

Vested... period...an ugly yellow knitted blanket from gramma is priceless, compared to a plush one in a bag from the store..

[@kofiacquah6972]

Whenever I sweep the house, I’m more conscious of others bringing dirt inside. Is that a form of the ikea effect?

[@PeteJudo1]

Hi Kofi. I don’t think so, because the ikea effect is about the pride you feel for building something. I think this is just mental availability. Dirt is top of mind for you after cleaning. So you are more aware of it. It’s more like a “try not to think of elephants, situation.”

[@rmstitanica3204]

I got the same feeling when I helped my dad set up and build a black desk from IKEA for my computer.

[@PeteJudo1]

Feels good doesn’t it? :D

[@rmstitanica3204]

@@PeteJudo1 yep, including the fact that I now have an addiction to the meatballs served there.

[@PeteJudo1]

@@rmstitanica3204 9 times out of 10 when I go Ikea, its for meatballs rather than furniture xD

[@JuliansStuffRoblox]

@@PeteJudo1 lol

[@JuliansStuffRoblox]

@@rmstitanica3204 same

[@tonyaking2672]

That’s so cool

[@PeteJudo1]

It is!

[@nirajsheladiya8246]

Thanks LOve from india✌✌

[@PeteJudo1]

Thanks! 😊

[@nirajsheladiya8246]

@@PeteJudo1 i did't find your ig account can you tell me ?

[@PeteJudo1]

@petesbitsofficial !

[@aidaabkenova]

It doesn’t explain why people who didn’t have the IKEA’s experience of leveling up your self-esteem buy it in the first place

[@ReglazeRX]

I guess some people need this weird flex in their lives. I find the store weird and the people inside strange. It is uncomfortable for me to wind my way through a maze of cheap ugly house fittings. Then be ejected into a dystopian warehouse with check out lines. Escalator to a stuffy overly lit parking structure where vain A type people try to run you over while backing into places to gather their cheap ugly house fittings. I do not like IKEA. I skipped over the unnecessary cafeteria.

[@bashisobsolete.pythonismyn6321]

oh dear. none of these effects seem to materialise in me. so heartless!

[@Markantwerp]

👍

[@PeteJudo1]

👌

[@latetotheparty184]

Sad really that people value the assembled furniture they did. It's a kit for god's sake. Now if they built a little table from scratch, I get it. It's just that the average person doesn't build so much as a bird house and so assembling a furniture kit is for them special. Sigh.

[@TeethToothman]

🫀⚡️🫀

[@peteraleksandrovich5923]

That's the dumbest idea I've ever heard. IKEA furniture is infamous for being a pain in the ass to assemble. Nobody likes assembling it. This is why behavioral science isn't a sceince.

[@smalltalk3904]

love the content but u gotta stop begging for subs and likes

[@chriswixtrom6514]

You Tube's algorithm for video suggestions rewards those videos with lots of likes and channels with lots of subs. When someone builds a YT video, they value it and want to share it widely.