The psychological impacts of ownership
Ownership is more than just a legal claim—it’s a fundamental part of how we understand ourselves and our place in the world. Whether it’s a family heirloom, a car, or a home, the things we own become extensions of our identity, shaping our sense of self and our connection to others.
But what happens when we don’t own the things that define our daily lives—like our workplaces? For most people, their job represents one of the most significant parts of their existence, consuming a third of their waking hours. Yet, they have no real say in the decisions that shape their work or the company’s impact on the world. This disconnect creates a sense of alienation, leaving workers disempowered and detached.
In contrast, when employees have ownership—when they truly have a stake in the business—they gain not only economic benefits but also a deeper sense of control, purpose, and belonging. Psychological ownership, a concept explored in organizational psychology, explains how ownership influences identity, self-efficacy, and social connection.
This article delves into the profound effects of psychological ownership, the consequences of its absence, and why shifting toward more equitable ownership structures could reshape the modern workplace. If we want a more just economy—one where people aren’t merely renting out their time to those who own everything—then rethinking ownership itself is essential.
The Power of Ownership: How Psychological Ownership Shapes Our Work and Lives
In the field of organizational psychology, there’s a concept called “psychological ownership.” Psychological ownership refers to the effect that happens when an individual owns something and that thing then becomes part of the extended self. (Belk, 1988; Dittmar, 1992)
Consider for a minute, something that you own—a bible, a car, a painting, a necklace from your grandmother, maybe a house. These items define some part of you. Cultural anthropologists and archeologists have studied and written extensively on the topic of “material culture” referring to how objects owned by people hold meaning. Whether it’s a physical object or an organization we’re associated with, the things that we own are a representation of the social, political, and symbolic elements of our selves. Through the things we own, our lives and their stories enter history and make physical our immaterial experiences, beliefs, and values. Our ownership is a materialization of our identity.
Yet when something so significant, such as our workplace, isn’t owned by us, we have little to no control over the actions and impacts of our work. Yet, we’re still associated with the firm, without any power to align its actions with ours. This dissonance can cause an extreme sense of alienation, which can leave people feeling isolated and dehumanized.
But, when we can own the thing, for example, when an employee owns part of a business, they have a stronger connection to the company and its members as well as a stronger sense of control over a huge chunk of their life, roughly one third, when they are at work.
Jon L. Pierce, a Professor of Organization and Management, is a leading thinker on the concept of psychological ownership. He says that there are three things “that contribute to an individual’s fundamental desire for ownership: efficacy, self-identity, and belonging.”
Efficacy is the ability to produce a result. And, according to scholars, “The satisfaction of changing an outcome through one’s own actions is found even in children” (Furby, 1991 in Avery et al., 2009). When an individual owns something, they are able to affect change in the thing. This ability shapes their self-identity and improves how they understand themselves.
Self-identity is highly influenced by perceptions of how people are regarded and valued by others. Given the link between possessions, social standing, and acceptability, ownership can have positive impacts on self-esteem. Beyond just the impacts on the individual, an improved level of self-esteem has been shown to improve pro-social behaviors. These are behaviors that tend to be friendly, playful, and peaceful, including inclinations toward sharing and offering help to others. These behaviors support an increased sense of belonging, something that all humans desire.
Belonging “is about being a member of, or striving for membership in, larger social communities. It is a concept that captures how selfhood is produced through imagined, claimed, or socially practiced dependencies and commitments” (Gammeltoft, 2018).
The lack of ownership by the majority of people has significant impacts on not only individuals, but also the society and economies they exist within. This is very true in the United States where people are divided into two groups—those who own things, and the rest of us who have to sell our time to the people who own things.
In his book, Bullshit Jobs, the anthropologist David Graeber emphasized this odd social dynamic in this way, "The idea that one person's time can belong to someone else is actually quite peculiar”…”how did we get to the situation we see today, where it's considered perfectly natural for free citizens of democratic countries to rent themselves out in this way, or for a boss to become indignant if employees are not working every moment of "his" time?"
Reimagining ownership in the workplace isn’t just about economic equity—it’s about giving people a sense of control, identity, and belonging in the place where they spend much of their lives. When workers have true ownership, they’re not just employees; they’re empowered contributors, able to invest in the future of their organizations and communities.