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Subjective valuations determine the demand for information. Users formulated value judgments regarding information are important for the design of information systems. This paper focuses on information as content. We begin with the "Endowment Effect" extension of "Prospect Theory". In a simple computer simulated business game, two groups of fourteen and seventeen participants simulated a management task in which they were provided opportunities to buy or sell information. The bidding mechanism was incentive compatible. Results show that, in agreement with Endowment Effect theory, people value information they own much more than information not owned by them. Our findings indicate a place for the subjective value of information on the WTA/WTP ratio continuum that emerges from pertinent literature. The ratio for information is similar to that of market goods. Participants had a strong inclination to purchase but not to sell information although the profit data suggests that the use of information had no objective benefit for profit-making. This preference is attributed to risk aversion rather than to loss aversion which is the most widely-accepted explanation of the Endowment Effect. 3

www.academicpress.com Beyond mere ownership: transaction demand as a moderator of the endowment effect

Laboratory experiments provide economic science with a universal method which can be employed to tackle a great array of problems. In this article we identify three direct connecting factors for the experimental method and environmental economics. First, social dilemmas are, in many cases, at the core of environmental problems: environmental services are often public goods or can be characterized as common pool resources. Experiments are able to test theoretical hypothesis for individual behavior in such social dilemma situations and generate stylized facts of individual behavior. The second connecting factor comes from the field of applied experimental work and can be characterized as the testbedding of institutional arrangements for the solution of environmental problems. The last direct application of experimental methods to environmental economics concerns the individual evaluation of environmental resources. But it is not only the great number of papers written on environmental economics that make it worth dealing with this special branch of experimental research. Rather, the environmental problem in all its facets seems to serve as a catalyst which helps to identify some methodological problems of the experimental method. For this reason, we will not only try to give an overview of the recent experiments in environmental economics but also will add some thoughts on the methodological implications of this work.