Sunk cost and commitment escalation
Posted: Tue Jun 01, 2004 10:37 am
Dear Sirs,
I am writing my masters thesis on persistent problems in organisations,
and would as part of this model the ""sunk cost fallacy"" in a project
considering several decision points. As an example I will use the product
development process to examine the dynamics of escalation of commitment
and its impact on which ideas are forwarded in the development process
and which ones are rejected.
Hopefully this will lead to insights on whether there are any high-
leverage strategies that can be employed (systems for determining
the potential of a project, incentive systems and so on).
I have searched for literature on the topic, but has not been able
to find a dynamic model (neither stock & flow nor causal loop) on
the topic, but have been able to find extensive literature on the
psychology leading to escalation of commitment and on innovation
pipelines.
My questions are therefore where I should look for a model which
is already dealing with such a problem, and whether there are
existing models that already capture important parts of the dynamics
of either the sunk cost fallacy or the product innovation pipeline,
so that I could use one as a starting point for further development.
Best regards,
Martin Nore
From: ""Martin Nore "" <martin.nore@operamail.com>
I am writing my masters thesis on persistent problems in organisations,
and would as part of this model the ""sunk cost fallacy"" in a project
considering several decision points. As an example I will use the product
development process to examine the dynamics of escalation of commitment
and its impact on which ideas are forwarded in the development process
and which ones are rejected.
Hopefully this will lead to insights on whether there are any high-
leverage strategies that can be employed (systems for determining
the potential of a project, incentive systems and so on).
I have searched for literature on the topic, but has not been able
to find a dynamic model (neither stock & flow nor causal loop) on
the topic, but have been able to find extensive literature on the
psychology leading to escalation of commitment and on innovation
pipelines.
My questions are therefore where I should look for a model which
is already dealing with such a problem, and whether there are
existing models that already capture important parts of the dynamics
of either the sunk cost fallacy or the product innovation pipeline,
so that I could use one as a starting point for further development.
Best regards,
Martin Nore
From: ""Martin Nore "" <martin.nore@operamail.com>