Comments on: The Sunk Cost Bias Mind Trap http://www.ratracetrap.com/the-rat-race-trap/the-sunk-cost-bias-mind-trap.html Tools to improve your mind and escape the trap Fri, 10 Feb 2012 13:47:23 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: asad gujjar http://www.ratracetrap.com/the-rat-race-trap/the-sunk-cost-bias-mind-trap.html/comment-page-1#comment-127576 asad gujjar Thu, 12 Jan 2012 17:49:55 +0000 http://www.ratracetrap.com/?p=2292#comment-127576 it is really a good article thanks.gujjar it is really a good article thanks.gujjar

]]> By: Business Conflict Blog » Laura Kaster on Impasse: It’s the Value, Stupid! http://www.ratracetrap.com/the-rat-race-trap/the-sunk-cost-bias-mind-trap.html/comment-page-1#comment-124384 Business Conflict Blog » Laura Kaster on Impasse: It’s the Value, Stupid! Mon, 26 Dec 2011 17:04:20 +0000 http://www.ratracetrap.com/?p=2292#comment-124384 [...] as well as heuristics such as hindsight bias and cognitive dissonance.  She also notes the “sunk-cost bias” that prompts litigants (and their advisors) to throw more money and effort into an endeavor [...] [...] as well as heuristics such as hindsight bias and cognitive dissonance.  She also notes the “sunk-cost bias” that prompts litigants (and their advisors) to throw more money and effort into an endeavor [...]

]]> By: Ben10 http://www.ratracetrap.com/the-rat-race-trap/the-sunk-cost-bias-mind-trap.html/comment-page-1#comment-113888 Ben10 Tue, 22 Nov 2011 21:35:19 +0000 http://www.ratracetrap.com/?p=2292#comment-113888 cool article thanks dostlar cool article thanks dostlar

]]> By: Unleash your inner tiger: Speak softly and carry a big stick | InsightFULL Blog http://www.ratracetrap.com/the-rat-race-trap/the-sunk-cost-bias-mind-trap.html/comment-page-1#comment-23157 Unleash your inner tiger: Speak softly and carry a big stick | InsightFULL Blog Fri, 09 Apr 2010 11:39:28 +0000 http://www.ratracetrap.com/?p=2292#comment-23157 [...] a dream or goal. But winners also know when to cut their losses and quit. They know not to dwell on sunk cost – something they can’t get back – and get themselves out of situations that only pull them [...] [...] a dream or goal. But winners also know when to cut their losses and quit. They know not to dwell on sunk cost – something they can’t get back – and get themselves out of situations that only pull them [...]

]]> By: Dragos Roua http://www.ratracetrap.com/the-rat-race-trap/the-sunk-cost-bias-mind-trap.html/comment-page-1#comment-21669 Dragos Roua Mon, 22 Mar 2010 06:32:20 +0000 http://www.ratracetrap.com/?p=2292#comment-21669 Thanks for the article, Stephen, it's timely for me. I think I tend to see things too often through the lenses of "profit": financial profit, emotional profit, life profit. That makes for a pretty tight observations of spending as you named it (if we take it that profit is what remains after you take out what you've spent from what you received). But this is not always the case. I mean, sometimes things are just not going on as we think they would. And we paid that money or invested those emotions. And I'm grateful for your take: just move on. Paper loss. Baloney. Life's ahead. Always. :-) .-= Dragos Roua´s last blog ..<a href="http://feedproxy.google.com/~r/Edragonu-TheChoiceOfAPersonalPath/~3/8idVlS22Buo/" rel="nofollow">33 Ways To Overcome Frustration</a> =-. Thanks for the article, Stephen, it’s timely for me. I think I tend to see things too often through the lenses of “profit”: financial profit, emotional profit, life profit. That makes for a pretty tight observations of spending as you named it (if we take it that profit is what remains after you take out what you’ve spent from what you received). But this is not always the case. I mean, sometimes things are just not going on as we think they would. And we paid that money or invested those emotions. And I’m grateful for your take: just move on. Paper loss. Baloney.

Life’s ahead. Always. :-)
.-= Dragos Roua´s last blog ..33 Ways To Overcome Frustration =-.

]]> By: Mike King http://www.ratracetrap.com/the-rat-race-trap/the-sunk-cost-bias-mind-trap.html/comment-page-1#comment-21487 Mike King Sat, 20 Mar 2010 02:11:14 +0000 http://www.ratracetrap.com/?p=2292#comment-21487 Excellent point here Stephen and great real examples. I've certainly had similar experiences with feeling like I have to finish something. Decisions on loss are almost always more emotional than the same potential equation than a gain. Studies support this phenomenon that most people would spend more money protecting the loss of something (sunk costs) than they would taking on an equal risk to gain the same amount. No sunk costs when looking to gain so no emotional connection. Its odd human behavior for sure and explains a lot of actions where people dig themselves deeper and deeper. .-= Mike King´s last blog ..<a href="http://learnthis.ca/2010/03/9-tips-on-handling-and-eliminating-negative-stress/" rel="nofollow">9 Tips on Handling and Eliminating Negative Stress</a> =-. Excellent point here Stephen and great real examples. I’ve certainly had similar experiences with feeling like I have to finish something. Decisions on loss are almost always more emotional than the same potential equation than a gain. Studies support this phenomenon that most people would spend more money protecting the loss of something (sunk costs) than they would taking on an equal risk to gain the same amount. No sunk costs when looking to gain so no emotional connection. Its odd human behavior for sure and explains a lot of actions where people dig themselves deeper and deeper.
.-= Mike King´s last blog ..9 Tips on Handling and Eliminating Negative Stress =-.

]]> By: Chetan Crasta http://www.ratracetrap.com/the-rat-race-trap/the-sunk-cost-bias-mind-trap.html/comment-page-1#comment-21335 Chetan Crasta Thu, 18 Mar 2010 12:46:19 +0000 http://www.ratracetrap.com/?p=2292#comment-21335 I agree. Ideally, we should always re-evaluate important past decisions when the time comes to act. However, I often fail to do this because of the mental effort involved. It is easier for me to think "I spent $150, therefore, at the time I thought it was a good idea. It probably still is a good idea." This kind of thinking probably has an evolutionary advantage -- if we constantly rethought every decision, we'd probably get very little done! I guess the Holy Grail is knowing when to reevaluate something and when to "go with the flow". .-= Chetan Crasta´s last blog ..<a href="http://destination-code.blogspot.com/2010/03/background-properties.html" rel="nofollow">The Background Properties</a> =-. I agree. Ideally, we should always re-evaluate important past decisions when the time comes to act. However, I often fail to do this because of the mental effort involved. It is easier for me to think “I spent $150, therefore, at the time I thought it was a good idea. It probably still is a good idea.”
This kind of thinking probably has an evolutionary advantage — if we constantly rethought every decision, we’d probably get very little done!
I guess the Holy Grail is knowing when to reevaluate something and when to “go with the flow”.
.-= Chetan Crasta´s last blog ..The Background Properties =-.

]]> By: Stephen Mills http://www.ratracetrap.com/the-rat-race-trap/the-sunk-cost-bias-mind-trap.html/comment-page-1#comment-21324 Stephen Mills Thu, 18 Mar 2010 11:37:18 +0000 http://www.ratracetrap.com/?p=2292#comment-21324 Sandra, thank you for commenting. I'm glad you have a name for it now :-) Sandra, thank you for commenting. I’m glad you have a name for it now :-)

]]> By: Stephen Mills http://www.ratracetrap.com/the-rat-race-trap/the-sunk-cost-bias-mind-trap.html/comment-page-1#comment-21323 Stephen Mills Thu, 18 Mar 2010 11:36:10 +0000 http://www.ratracetrap.com/?p=2292#comment-21323 Hi Chetan, thanks! In the ticket example you bring up there is some new information. At the time you bought them you thought you would want to go, but when the day rolls around you would rather do something else. We humans are terrible at predicting future conditions. Don't get me wrong, you should go through an analysis like you describe except you shouldn't consider the fact that you spent $150. Experiments show that if you were prepared to spend $150 and at the last second you were offered them at $75, you would be less likely to go. You would have less invested in them. However, rationally, the value of the show to you would not have changed simply because you got the tickets at a lower cost. So when I make decisions like this I try to consider all factors like experiencing something new, social factors, whatever I now know. Whatever costs I have sunk into it in the past are irrelevant to whether it is still a good decision. Hi Chetan, thanks! In the ticket example you bring up there is some new information. At the time you bought them you thought you would want to go, but when the day rolls around you would rather do something else. We humans are terrible at predicting future conditions.

Don’t get me wrong, you should go through an analysis like you describe except you shouldn’t consider the fact that you spent $150. Experiments show that if you were prepared to spend $150 and at the last second you were offered them at $75, you would be less likely to go. You would have less invested in them. However, rationally, the value of the show to you would not have changed simply because you got the tickets at a lower cost.

So when I make decisions like this I try to consider all factors like experiencing something new, social factors, whatever I now know. Whatever costs I have sunk into it in the past are irrelevant to whether it is still a good decision.

]]> By: Chetan Crasta http://www.ratracetrap.com/the-rat-race-trap/the-sunk-cost-bias-mind-trap.html/comment-page-1#comment-21314 Chetan Crasta Thu, 18 Mar 2010 08:25:47 +0000 http://www.ratracetrap.com/?p=2292#comment-21314 Great post! I wonder what thought process leads to this cognitive bias. Taking the $150 theater ticket example, since at the time of buying the ticket I thought it was worth the $150 and the time taken to watch it, unless some new information is available to me or some new analysis, I would attend the show. Also, by not attending the show I risk missing out on something important, the value of which cannot be ascertained. However, I know exactly what I am going to lose by attending the show (the time). So, fear of the unknown might also have something to do with it. Great post!
I wonder what thought process leads to this cognitive bias.

Taking the $150 theater ticket example, since at the time of buying the ticket I thought it was worth the $150 and the time taken to watch it, unless some new information is available to me or some new analysis, I would attend the show.

Also, by not attending the show I risk missing out on something important, the value of which cannot be ascertained. However, I know exactly what I am going to lose by attending the show (the time). So, fear of the unknown might also have something to do with it.

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