We propose a new explanation of the endowment effect. The value of exchanged goods is uncertain. Specifically, the value is assumed to be ambiguous, represented by a set of probability distributions over possible values. Ambiguity averse agents (maxmin expected utility maximisers) set WTA and...

We investigate how risk aversion (RA) shapes the informative content of prices in an experimental asset market, where traders are sorted according to their RA. RA should induce steeper individual demands and, under its most common parametrizations, drive equilibrium prices closer to revealing...