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Sunk-Cost Effect

Explanations > Theories > Sunk-Cost Effect

Description | Example | So What? | See also | References

Description

When we have put effort into something, we are often reluctant to pull out because of the loss that we will make, even if continued refusal to jump ship will lead to even more loss. The potential dissonance of accepting that we made a mistake acts to keep us in blind hope.

We also tend to forget the original reasoning behind our decisions and so continue to act beyond the intended purpose.

Example

It is common for people who have invested in company shares to hold on tight to them as the market slumps, in the desperate hope that the shares will rise in price again.

So what?

Using it

Get people to make a number of small and easy commitments. When they try to pull out, remind them of the total commitment they have already made.

Defending

When thinking of pulling out of something, focus on future costs and benefits rather than past investment.

See also

Commitment, Cognitive Dissonance, Investment Model

References

Arkes and Blumer (1985)

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Site Menu

| Home | Top | Quick Links | Settings |

Main sections: | Disciplines | Techniques | Principles | Explanations | Theories |

Other sections: | Blog! | Quotes | Guest articles | Analysis | Books | Help |

More pages: | Contact | Caveat | About | Students | Webmasters | Awards | Guestbook | Feedback | Sitemap | Changes |

Settings: | Computer layout | Mobile layout | Small font | Medium font | Large font | Translate |

Please help and share:

Quick links

Disciplines

* Argument
* Brand management
* Change Management
* Coaching
* Communication
* Counseling
* Game Design
* Human Resources
* Job-finding
* Leadership
* Marketing
* Politics
* Propaganda
* Rhetoric
* Negotiation
* Psychoanalysis
* Sales
* Sociology
* Storytelling
* Teaching
* Warfare
* Workplace design

Techniques

* Assertiveness
* Body language
* Change techniques
* Closing techniques
* Conversation
* Confidence tricks
* Conversion
* Creative techniques
* General techniques
* Happiness
* Hypnotism
* Interrogation
* Language
* Listening
* Negotiation tactics
* Objection handling
* Propaganda
* Problem-solving
* Public speaking
* Questioning
* Using repetition
* Resisting persuasion
* Self-development
* Sequential requests
* Storytelling
* Stress Management
* Tipping
* Using humor
* Willpower

Principles

Explanations

* Behaviors
* Beliefs
* Brain stuff
* Conditioning
* Coping Mechanisms
* Critical Theory
* Culture
* Decisions
* Emotions
* Evolution
* Gender
* Games
* Groups
* Habit
* Identity
* Learning
* Meaning
* Memory
* Motivation
* Models
* Needs
* Personality
* Power
* Preferences
* Research
* Relationships
* SIFT Model
* Social Research
* Stress
* Trust
* Values

Theories

* Alphabetic list
* Theory types

And

– About
– Guest Articles
– Blog!
– Books
– Changes
– Contact
– Guestbook
– Quotes
– Students
– Webmasters

| Home | Top | Menu | Quick Links |

© Changing Works 2002-
Massive Content — Maximum Speed