Sunk Cost Fallacy

"I'm well aware that there's a high chance that what we're doing may result in doomsday for us all. But I pushed my chips into the middle of the table long ago, so I might as well play my hand to the end."

— Redcloak, The Order of the Stick

Sunk cost fallacy is a cognitive bias that causes Bob to remain committed to a course of action because he's already spent time or resources on it, even though the commitment is irrational (i.e. he would be better off walking away). When Bob is engaging in this fallacy, he will remain set on the course of action even if the profit from his success would be less than what he's already spent.

His line of thought might run thus:

I have already spent eight dollars on this contest. If I spend seven more, I can win the prize.
I could buy the prize elsewhere for five dollars.
But if I stop now, the money I already spent will be wasted, so I must continue.

This trope is not merely for any commitment to a course of action; the above is only a fallacy since Bob will be spending seven dollars instead of spending five. If Bob expects to only spend two dollars more on the contest, for example, as opposed to five, it would be valid to continue even if the total spent ends up being more than just buying the prize ($10 vs $5). In order for a situation to be the Sunk Cost Fallacy, all of the following must be true:

1. Bob remains committed to a course of action.
2. Bob is justifying continuing by citing the time and/or resources he has already spent.
3. The cost of continuing will exceed the cost of Bob stopping, taking on the loss, and moving on.

Even if Bob calculates that he could sell the prize for twenty dollars, it's still a sunk cost fallacy (because continuing the contest will leave him $5 ahead after the sale, while just buying the prize elsewhere will leave him $7 ahead.)

It is also important to note that this fallacy is entwined with economic theory and thus will discount other valid reasons Bob might wish to continue, for example if he was trying to win the contest to impress his peers, or that the shop might be closed so it becomes a matter of "spend 15 dollars now vs spend 5 dollars tomorrow" (this concept is known as Utility).

This forms a particularly powerful combination with the Gambler's Fallacy, as Bob might not only continue because he does not want to have wasted his money, but also because the very fact he has made losses is evidence he is "due" for a win. These two false forms of reasoning drive ruinous gambling problems.

Compare I've Come Too Far. Contrast Know When to Fold 'Em and Tiger by the Tail.

Also called

• Foot in the door (in sales)
• Camel's nose (in social psychology)
• Throwing good money after bad (in business)
• Pay-or-play (in sports and entertainment)
• Pouring sand down a rat hole (usually in politics)

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Examples:

• Fan Works
• Video Games

Comic Book

• In the Disney Ducks Comic Universe, this is ultimately why Magica DeSpell is after Scrooge's #1 Dime. The Witches' Council, as part of the Rite of Passage any witch has to go through to reach adulthood, gave Magica the Midas Touch quest that requires a coin touched and owned for any length of time by the world's billionaires. But the task had been so hard and infuriating that by the time she went to collect the last coin from Scrooge — who was willing to just sell Magica a dime for a dollar — the reveal that Scrooge had his #1 Dime for his entire life caused her to focus on that coin exclusively. Magica rationalized it by believing it would make the Midas Touch charm much better than a random coin that Scrooge just sold her. While the Witches Council has realized facing Scrooge is an impossible task and is willing to let her take a different quest, Magica refuses because she's put too much effort into taking Scrooge's #1 Dime to even consider anything else. As such, Magica continues to fail in her efforts because her pride won't let her accept defeat, and because it would mean all the effort in taking the dime would have been for nothing.

Film — Live-Action

• Alluded to in First Man when Neil Armstrong is nearly killed in the LLRV accident. His seniors tell him it's too risky for him to fly such a dangerous machine again. Neil points out that it's the best training they have for how to fly the real lunar module, and that it's a "little late" to talk about not risking the lives of the astronauts. It's clear that Neil commits to the Apollo program because he thinks that backing out would make the sacrifices of the earlier astronauts, and other pilots who died during test flights, count for nothing.

Literature

• In Conned Again, Watson! by Colin Bruce, a book that uses the Sherlock Holmes characters to explain statistics, Holmes explains this fallacy and several others to the client, a businessman who is putting more money into a less successful venture because it cost more to start with, and Watson thinks smugly that he can avoid mistakes like that. The following day, Watson buys a loaf of bread for sandwiches, and then walks past a street vendor selling ham sandwiches at a reduced price to get ham from the butcher. When Holmes points this out, Watson, of course, replies "But I had already bought the bread."
• Reacher Gilt's scam in the Discworld novel Going Postal relies heavily on this. Even as the service on the Grand Trunk semaphore line gets worse and worse, he sweet-talks investors and board-members into "throwing good money after bad" while pocketing most of it and covering it up with tricky accounting and corporate buzzwords like "embracing diversity" and "synergistically". Not-quite-reformed con artist Moist von Lipwig is equal parts impressed and disgusted when he realizes what Gilt is up to.
• Extensively discussed in The Dresden Files short story "Bigfoot on Campus" in reference to the White Court of Vampires. Both Harry and River Shoulders reflect on how the White Court is founded on the Motivational Lie started by "some ancient bastard/bitch" stating that it's okay for them to be emotion-draining monsters. The aforementioned bastard/bitch's descendants have then been intentionally obscuring the truth from their own children until it's too late, and subsequently invoke this trope afterwards so that the new vampire will fall into line and accept all the Court's teachings as valid because the only alternative would be realizing that there's no excuse for having killed another human being. Related to this, Charles Barrowill can't accept the possibility that he might not have been a murderer if his parents had just been honest with him, and so tries to use an Appeal to Tradition argument (which ultimately just boils down to this trope) to make sure that his daughter grows up to be as much of a miserable and inhuman monster as he is.
• The Licanius Trilogy: A variant of this fallacy is part of why the loyalist faction of the Venerate stay loyal to Shammaeloth. It promises the power to rewrite the past, meaning that all the atrocities the Venerate committed to get where they are can be undone. And so the Venerate persist in their faith, even in the face of mounting evidence that they were lied to and Shammaeloth has nothing but pain and suffering in mind, because giving up on their loyalty to Shammaeloth would mean admitting that all their crimes can never be undone.

Live-Action TV

• The Cleaner (UK): Discussed by the Widow. By the time she realized that she was married to a boring selfish man, she had committed decades of her life to the marriage. She felt that if she left her husband it would render a good portion of her life a waste and she could not deal with that.
• Community: In one of the documentary episodes, the Dean gets Annie to work as a script supervisor while he directs a commercial. He suffers from a severe case of Sanity Slippage, and after several days of putting up with his increasingly bizarre demands, Annie is completely out of it and ungroomed. She rationalizes the Dean's behaviour because she doesn't want to admit that she's wasted several weeks of her life helping him.
• In a "Blogs of Doom" column in Doctor Who Magazine based on "The Brain of Morbius", Condo asks Solon why he needs to cut off the Doctor's head and put it on the Mix-and-Match Man he's created to house Morbius's brain, instead of just putting the brain in the Doctor's body. Solon replies that he's built a patchwork body and it took a lot of time and effort, and he's using it.

Music

• The Megas: By "Gamma Unchained" in History Repeating - Blue, Wily has ended up falling fully into this, convinced that after all the damage his past plans to Take Over the World (for everyone's own good, of course) have done, he has to win, otherwise all those deaths were pointless. So he builds a giant robot that decides to "restore peace" by killing everyone.
  I cheated, the lies that I told/Were for a future that I have seen/The death, the lives that I stole/The end has to justify the means.
• In "Ringtone" by "Weird Al" Yankovic, the protagonist explains that he absolutely despised his ringtone, that it’s caused him nothing but trouble, and he can’t even remember why he bought it in the first place... but he refuses to just delete it because he doesn’t want to waste the $1.99 he spent on it.

Podcasts

• The Last Podcast on the Left: In part 3 of their series on the Aum Shinrikyo cult, the hosts tell the story of a woman who joined the cult, fled multiple times, and each time was brought back and made to undergo the Bardo Initiation, a ritual meant to frighten her into staying. Eventually, when she fled again, she returned entirely on her own because she couldn't escape the thought of the cult's guru, Shoko Asahara, sending her to Hell. Hosts Marcus Parks and Henry Zebrowski note the Sunk Cost Fallacy as one of the reasons for this behavior. By leaving, all the suffering she went through while part of the cult, all the years spent there, all the years her family spent there because of her joining, would become All for Nothing. This idea would become a frequent talking point on future cult episodes, such as L Ron Hubbard's Scientology, Jim Jones's Peoples Temple, and Marshall Applewhite's Heaven's Gate.
  Henry: The problem is that mostly when you put yourself in these set of circumstances, when have given up so much control, the idea that you were ever wrong about that is very embarrassing and very hard to come back from. When you have so fully subjugated yourself to someone else, in order to then believe that you were wrong the entire time means that you essentially gave up years of your life, and the shame and the grief associated with that causes these people to stick by these beliefs for a really long time. Because basically, in order for her to disbelieve that Asahara is real then she has to, then, also has to take into her mind that she went through the Bardo thing for no reason.
  Marcus: Yeah, and not only that, but she had a family there, as well. So, not only is she wrong, but she has also wasted her childrens' lives, she put her children through all of this. The whole belief system is in shambles.

Visual Novels

• Danganronpa V3: Killing Harmony:
  • This is what trips up Chapter 3's culprit. They created an elaborate deathtrap setup in three different rooms to be able to kill a victim while seemingly being uninvolved... and then got caught setting it up, resulting in them needing to kill the witness. The impromptu murder turned out to be the closest thing to The Perfect Crime in the series, as the witness had been wandering around alone in the middle of the night without anyone else's knowledge and there was nothing connecting the killer to the crime scene, but the killer decided they'd put too much work into such a cool and thematic deathtrap and decided to go ahead with their plan anyways. This second murder leaves enough evidence (with the aid of the killer misspeaking during the trial) to pin the culprit for both murders. Although Korekiyo might not have cared as much about getting caught as killing Tenko so she could be an "admirable friend" for his late sister.
  • This also factors into the mastermind's motivation: having dedicated her life so completely to Danganronpa, she cannot conceptualize a world without it, and chooses to die in the school's destruction.
• In The Murder of Sonic the Hedgehog, one of the train cars has a slot machine that the player can choose to gamble on. They will always lose, and eventually Tails will outright ask them if they've heard of the fallacy.
  Player: The phenomenon whereby a person is reluctant to abandon a strategy or course of action because they have invested heavily in it, even when it is cleare that abandonment would be more beneficial? Of course I've heard of it, why do you ask?
  Tails: No reason.

Web Animation

• Zee from Animated Spellbook talks about Team Funsize. While delving into the nightmare dungeon of Glitterhame, they lost a partymember, all their equipment, and were nearly beaten to death multiple times over, but had come too far to stop now. Zee specifically calls out that they had clearly never heard of the fallacy.
• Epithet Erased: When Molly questions why Mera, whose epithet leaves her in constant pain, doesn't just have somebody use the amulet to take it away, they respond that if they do that, the past decade of training they put themselves through in order to reach their current level of power would be All for Nothing.
• Locus from Red vs. Blue. In his mind he has to keep following orders because admitting he has a choice now would mean admitting he had a choice in all his previous actions, and he can't face that.

Webcomics

• In The Inexplicable Adventures of Bob!, the protagonist explains to recurring villain Fructose Riboflavin that he's chasing a sunk cost, and that it likely feels like giving up on revenge would mean everything else was a waste. Fructose is both stricken by this realization, and really not amused.
• An Oglaf comic has a group of villagers decide to take a poorly built ship to war rather than cut their losses and have the months of hard work spent on building it be wasted. It doesn't end well for them.
  Viking: Seriously, how does a boat just catch fire all by itself?
• The Order of the Stick has Redcloak both lampshade this and deconstruct it, as expressed in Start of Darkness. It's not that Redcloak believes in Lord Xykon's plan, or even likes the idea of what Xykon is trying to achieve; in fact, Redcloak hates Xykon's guts. The reason Redcloak stays around in spite of his hatred is that Redcloak believes that if he quits, it'll make all of the horrible things he's done worthless. This is in spite of Redcloak being told by both his brother and Xykon himself that this is an empty excuse. Redcloak continues to support Xykon despite being entirely too familiar with the lich's Bad Boss habits and knowing that completing the Plan with Xykon will not work out in Redcloak's favor. In fact, Xykon tells Redcloak point-blank that he's using this flaw of Redcloak's as a way to keep him under control. But because Redcloak feels too invested to quit, in spite of knowing that he's being strung along and that his flaws are being exploited by the lich, Redcloak keeps himself trapped in villainy. This causes him to decay to the point that when someone points out to Redcloak that he already has what he wants, Redcloak still refuses to change course because it would mean admitting to himself that he's made a mistake, and he just can't do that.
• In Penny Arcade, the trope is discussed and namedropped in "Finisher," when Tycho explains why he completed Cyberpunk 2077 despite not liking the game, likening it to eating at a buffet that makes him sick because he already paid for it. Gabe asks if he's heard of the Sunk Cost Fallacy, and Tycho gives his less than accurate description of it.
  "It means that you need to maintain harmful behaviors in perpetuity because you made a bad decision a long time ago, and now you deserve to be punished."

Western Animation

• It's the Great Pumpkin, Charlie Brown: By the end, Linus decides that he will wait another year for the Great Pumpkin, even though waiting before has cost him at least two Halloweens and the respect of the neighborhood.
• The Owl House: Philip Wittebane's initial reason for traveling the Boiling Isles was to rescue his brother Caleb. But after he killed Caleb in a fit of rage, Philip didn't return back home to report his failure and tragedy. Instead, he stayed in the Boiling Isles and devised a plan to wipe out all witches in one swoop so he can return home as the greatest witch hunter. A plan that required centuries to pull off, by which point Gravesfield has moved on from its witch hunting past. When his plan fails at the last minute and he is stranded in the modern world of Gravesfield, Philip refuses to accept defeat and instead digs up the last remaining Titan's Blood to go back to the Boiling Isles and finish the job. It's becomes evident that he didn't want to accept that his actions were All for Nothing.

Real Life

• The Jolly Roger Telephone Company is a web-based company that provides bots that are designed to waste telemarketer time by responding with pre-programmed routines and other time-wasters like "Yeah" and "uh huh" to make the caller think there's a real person on the other end of the line. In some cases, even after having ages of their time wasted with a bot, the callers will still keep going, thinking that they've already spent all this time already, so at this point they have to get something out of the call. They will grasp at any straw, anything at all the bot says that leads them to believe that the person on the other end of the line is actually interested in what they're pitching. But, of course, there is no person on the other end of the line, only a bot that can never give them what they want because it isn't programmed to do so. ^note (That being said, even if they wanted to hang up on the bot, they often can't because they're not allowed to do so unless the person is being obviously abusive towards them [which the bots never are] and/or the computerized call system requires supervisor intervention to hang up on their end. Those who decide to cut their losses will start hurling abuse and vulgarities towards the bot to try and get them to hang up, but of course this never works either.)
• This was one of the factors in why the CED videodisc format never did well — it had been stuck in Development Hell since the 1960s and RCA was determined to see it through, despite the obvious shortfalls of the format in comparison to V/H/S and LaserDisc; they'd blown tons of money on it and it would be a severe blow to their corporate pride if they opted to scrap it. (This, along with NBC's issues at the time, wound up being RCA's Creator Killer; GE would purchase the company in 1986, largely for NBC, and discard the rest; the last CED titles were released that year, player production having ceased two years prior.)
• Nintendo's Virtual Boy is another example, or possibly an aversion depending on how you look at it. Halfway through development they learned two things, the first was that playing video games on a red-on-black screen that could make your eyeballs sore was a miserable experience and the public would hate it, the second was that a color display would have pushed the price far above what the average consumer could afford. They decided to cut their losses and release it in an essentially unfinished state knowing full well it would flop just to make some revenue out of it and mitigate the losses. Project chief Gunpei Yokoi, who also created the Game Boy (and Metroid), fell on his sword and left for Bandai.
• This was long argued to be the main reason why Russia lost the Russo-Japanese War. By the end of the war Japan was winning militarily, but its economy was stretched to the breaking point, and their mobilization resources were completely depleted, as they had started drafting kids and geezers into the army, with the predictable outcome for troops quality and morale. Some analysts say that had Russia pushed just for a couple of months more, even in the wake of the horrific losses like Tsushima and Mukden, Japan would've sued for peace. On the other hand the Tsar's government had really lousy intelligence (as well as unrest on the home front that needed attention) and didn't know that, so they decided to cut their losses and sued first.
• It has been argued that the reason World War 1 lasted as long as it did was in no small part because of this fallacy, for all major powers involved. The blog A Collection Of Unmitigated Pedantry even uses it as an example of failing to update an strategy when conditions change, and sums it up like this:
  "By 1915 or 1916, it ought to have been obvious that no gains made as a result of the war could possibly be worth its continuance. Yet it was continued, both because having lost so much it seemed wrong to give up without ‘victory’ and also because, for the politicians who had initially supported the war, to admit it was a useless waste was political suicide"
• In World War 2, following Japan's annexation of French Indochina, America passed an embargo on oil and other resources crucial to the Japanese war effort in order to force Japan to negotiate a peace with the Republic of China. Without that oil, Japan's war machine would literally run out of fuel in a manner of months. Japan's high command had two options. First, they could concede to America's demands and enter peace negotiations with China, but in doing so would likely give up most of Japan's gains and would dishonor Japan in the eyes of the Japanese public. Second, they could launch "Attack Plan South" by which the IJN would preemptively strike America's Pacific Fleet at Pearl Harbor to open the way for an invasion of Britain and the Netherlands' oil-rich holdings in Southeast Asia and Oceania and just hope that the shock of a decisive, overwhelming victory would force America to back down. Naturally, Japan chose the second option, and by doing so not only lost Japan the war in China, but the rest of her empire and a large portion of her population as well.
• Another aversion: when HMS Belfast, that warship on the Thames, was damaged by a mine during World War 2, it was deemed that the fastest repair solution would be more expensive than a new cruiser. That would have taken three years and dry dock space that Britain didn't have, however.
• A known way for gangs to initiate new members is to have them commit progressively greater crimes, then invoke this fallacy if the newbie tries to back out. Stealing a case of beer or selling a small amount of drugs isn't that big of a deal, in the long run. But committing murder certainly is a big deal, and now you're up to your neck in it. Since you're screwed either way, the gang rationalizes, you may as well stick with people who are going to have your back when the proverbial rubber meets the road. The trouble is that, when said proverbial rubber meets said proverbial road, the now-invested newbie is likely going to be left on their own for the gang to save their own hide. This gets brought up in shows like Beyond Scared Straight and other real-life crime shows, where former gang members talk about how they were slowly sucked into a world of crime because they agreed to one small thing.
• The Hubble Space Telescope is a good example of why additional costs after the fact aren't necessarily this trope. When the Telescope was first deployed, there was a major flaw in the primary optical mirror; it has been ground to the wrong curve, making the images it sent back very blurry, and rendering the primary purpose of the telescope (clearer images outside Earth's atmosphere) mostly pointless. Some people quickly wrote off Hubble as a failure at that point, so when a mission to send up a new module to correct for the bad optics was announced, these people slammed NASA for throwing more money into a telescope they thought would never work properly. The fact was, NASA knew exactly what was needed to correct for the issue, thanks to documentation of the process used to grind the mirror, which was ground very precisely to the wrong shape. Long story short, the corrective module was sent up to (and installed in) the telescope, and afterwards, new images from Hubble were incredibly clear, as had been envisioned at the start of the project. The money spent to correct the optical issues (a relatively small amount compared to the overall cost of the telescope) proved to be money well-spent...and more to the point, the repair cost a fraction of the money that building a completely new telescope would have, for most of the same benefit (one of the telescope's original modules had to be removed for the corrective module to be installed).

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