Age, Expertise, and the Sunk-Cost Fallacy

Abstract

The present study is an investigation of age and expertise differences in the sunk-cost fallacy (SCF), the phenomenon of basing one's decision on past investments rather than the future consequences and/or benefits. The current study used a procedure which required participants to answer sunk-cost vignettes and to justify their answers to the vignettes. Results revealed that demonstration of the SCF decreased with age: young adults demonstrated the fallacy the most frequently and older adults demonstrated it the least frequently. An age by expertise interaction was identified for normatively correct decisions: expert young adults made more normatively correct decisions than naive young adults. Justifications differed by age group and decision situation: young adults tended to provide justifications related to the salience of the investment as their decision justification when making decisions regarding a dinner situation and middle-aged adults provided justifications of contingencies more frequently in a situation regarding a movie purchase. Young adults' focus on the salience of the previous investment suggested an avoidance of additional loss.

Cite this work

No public copy is stored for this record, so only the metadata is cited.

Stored only when both papers are in the corpus — 2 citations exist upstream.

Papers that cite the same references — the relational fallback while embeddings are still backfilling.