Is Your Brain Biologically Programmed to Be Selfish?

In the latter half of the 20th century, a new field of study, cognitive psychology, began to gain momentum. For a long time, the prevailing ideas in psychology revolved around psychoanalysis, reflexes, or behaviorism. But this newer approach started exploring the hidden mechanics of our minds, and its findings quickly found application in unexpected areas, like economics. It turned out that the image of humans as fundamentally rational beings—a pinnacle of common sense—was deeply flawed.

Psychologists like Daniel Kahneman and Richard Thaler, who would go on to win Nobel Prizes in Economics, revealed a startling truth: our decisions are often guided not by logical calculation, but by deep-seated, irrational, and automatic responses. Some of these responses are cultural, but many are biological, rooted in an evolutionary past where the goal wasn't to be reasonable, but to survive—to gain more and lose less. This exploration of our cognitive biases is fascinating, not for what it tells us about markets, but for what it reveals about ourselves.

The Famous Mug Experiment

One of the most well-known cognitive biases is the endowment effect, famously demonstrated by Kahneman and Thaler. In their experiment, one group of students was given a free mug adorned with the university's logo. They were, of course, pleased. A second group was asked how much they would be willing to pay to buy the same mug. They offered modest sums, perhaps two, three, or four dollars on average.

Here comes the twist. The researchers then went back to the first group—the students who had been given the mugs—and asked if they would be willing to sell them. Suddenly, the price skyrocketed. People who had received the mug for free were now demanding seven, eight, or even fifteen dollars for it.

How can this be? The mug was the same. But for one group, it was a potential purchase, while for the other, it was a possession. The moment something becomes "ours," its value in our minds inflates dramatically.

A Bird in the Hand

The biological mechanism behind this is brutally simple. In nature, acquiring anything requires an expenditure of energy—calories. It involves risk and effort. Once you have successfully hunted or foraged, the food you possess represents not just sustenance, but the energy you've already spent to get it. To give it up would be to lose not only the item but also the sunk cost of your efforts. Your own shirt is closer to your body. Parting with what you own creates a real sense of discomfort.

Conversely, something you do not yet possess is valued less, because its price is mentally reduced by the amount of risk and energy you must still expend to obtain it. The logic is primal: if you have something, hold on to it. A bird in the hand is worth two in the bush. This isn’t a flaw in our design; it’s a feature that helped our ancestors survive. But in our complex social world, it creates paradoxes.

My Pain is Realer Than Yours

This effect extends beyond physical objects to our very experiences. Consider another psychological experiment, one that I find quite troubling. Two boys are seated at a table, facing each other, and given a peculiar instruction: one must kick the other under the table, and the second must then return the kick with the exact same force.

The experiment almost always ends in a fight.

Why? Because when you are kicked, you feel the full impact of the pain. It is your pain, immediate and undeniable. When you kick back, you can only guess at the force. It almost always seems to you that you've matched the force, but to the other person, who feels the full impact of your kick, it feels like an escalation. So, he hits back harder, and the cycle continues until it devolves into a brawl.

Culturally, they agreed to the rules. Biologically, they couldn't escape a fundamental truth: my own suffering, my own loss, my own possessions feel more significant than anyone else's. I don’t feel the other person’s pain. It’s an abstraction. This is the endowment effect applied to our very bodies and feelings.

The Modern Age of Egocentric Fundamentalism

Now, imagine this deeply ingrained biological trait amplified by the conditions of our modern world. We are living in an era of what could be called egocentric fundamentalism. Several factors contribute to this.

First, scarcity has been replaced by abundance for many. In the past, getting something, like a new toy, was a rare event that had to be earned or patiently waited for. Now, for many children, desires are met almost instantly. The gap between wanting and having has shrunk, weakening the muscle of patience and appreciation.

Second, the nature of authority and upbringing has shifted. The idea of parents as absolute authorities has given way to a more child-centric model. At the same time, social pressures that once enforced community-oriented behavior have waned. School is often seen not as a place of character formation but as a "service provider." There's no collective project, no sense of shared duty that requires subordinating one's own ego.

Finally, our social lives are increasingly lived in virtual worlds. These digital realms can give the illusion of community without demanding any of the real work of social life: compromise, shared goals, and navigating difficult, face-to-face interactions. This fosters an autistic-like bubble where the individual becomes the center of their own universe, a universe populated by their desires alone.

The Coming Collision

What happens when the endowment effect collides with this rising tide of egocentrism? The result is a world where every individual is their own Mount Everest, unable to see the landscape around them. When it comes time to divide something fairly, to compromise, or to acknowledge another's contribution, many are simply incapable of it. They don't see other people. They see a world made up of "me" and "my dreams."

The inevitable outcome is a pervasive sense of being cheated. Everyone feels they were entitled to a kingdom but received a pittance. The very idea that others have feelings, that their pain is as real as our own, becomes a foreign concept. "I am suffering; the rest are just complaining." This is the endowment effect on a societal scale.

This is why empathy, compassion, and the ability to put ourselves in another's shoes are not just sentimental virtues. They are essential tools for survival in a complex society. By consciously working to reduce our own egocentrism, we can escape the endless hunger for "more" and the constant suffering that comes from feeling we were never given enough. When we become truly social, truly human, we stop being so hungry, and we begin to understand what happiness really is. This, to me, is infinitely more important than any economic theory.

References

• Kahneman, D., Knetsch, J. L., & Thaler, R. H. (1990). Experimental Tests of the Endowment Effect and the Coase Theorem. Journal of Political Economy, 98(6), 1325–1348.
  This is the foundational academic paper that first documented the "endowment effect" through a series of experiments, including the famous mug study described in the article. It provides the empirical evidence showing that people demand significantly more money to give up an object they own than they would be willing to pay to acquire the same object.
• Kahneman, D. (2011). Thinking, Fast and Slow. Farrar, Straus and Giroux.
  This widely accessible book explains the two systems of thought that govern our minds: the fast, intuitive, and emotional "System 1," and the slower, more deliberate, and logical "System 2." The endowment effect is presented as a prime example of a bias stemming from System 1's loss aversion—the principle that the pain of losing something is psychologically about twice as powerful as the pleasure of gaining it. The concepts are primarily discussed in Part 4, "Choices," particularly in Chapters 27 and 28.
• Thaler, R. H. (2015). Misbehaving: The Making of Behavioral Economics. W. W. Norton & Company.
  Written by Kahneman's research partner, this book provides a narrative history of the development of behavioral economics. Thaler recounts the story behind the mug experiment and other studies in an engaging and personal way. He explains how these seemingly minor "misbehaviors" systematically violate the assumptions of traditional economics and reveal profound truths about human nature, including the powerful and often irrational attachment we form to our possessions. The endowment effect is discussed in detail in chapters like "The Endowment Effect: Or, Why is a Bird in the Hand Worth More Than Two in the Bush?"