Belle Beth Cooper offers a concise definition: The term sunk cost refers to any cost (not just monetary, but also time and effort) that has been paid already and cannot be recovered.
Barry Schwartz in The Paradox of Choice
writes: What leads me to believe that sunk-cost effects are motivated by the desire to avoid regret rather than just the desire to avoid a loss is that sunk-cost effects are much bigger when a person bears responsibility for the initial decision. If sunk-cost effects are just about hating to lose, then whether the loss is your responsibility or not is irrelevant.
Sometimes we don't make the right decision because we know how much money, time or energy we've invested in a certain path. The thing is...that doesn't make the path worth staying on. We have to make decisions based on zero sum accounts.
Loss doesn't become any less of a loss just because you "stick with the plan."
writes: What leads me to believe that sunk-cost effects are motivated by the desire to avoid regret rather than just the desire to avoid a loss is that sunk-cost effects are much bigger when a person bears responsibility for the initial decision. If sunk-cost effects are just about hating to lose, then whether the loss is your responsibility or not is irrelevant.Sometimes we don't make the right decision because we know how much money, time or energy we've invested in a certain path. The thing is...that doesn't make the path worth staying on. We have to make decisions based on zero sum accounts.
Loss doesn't become any less of a loss just because you "stick with the plan."
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