Sunk Cost Fallacy
The sunk cost fallacy is the reluctance to abandon a course of action because of past investment, even when abandoning would be more beneficial going forward.
Isn't quitting wasteful?
Past costs feel like they “would be wasted” if abandoned, but they are already gone either way; only future costs and benefits should drive the decision.
- Closely related to Attachment
- “In for a penny, in for a pound”
Examples
- “I stopped going to the gym, lost all my gains, no point going back now”
- “We’ve been together so long, only choice is to stick”
- “I’ve been lazy for 4 hours, the day is ruined, may as well keep being lazy”
In organizations
Many large-company decisions run on this: “we’ve already built this infrastructure, let’s keep expanding it”, when the future cost outweighs the future value