You’ve been at the same job for years, even though you secretly hate it. But you’ve already invested so much time and worked your way up the ladder, so you dig in your heels and stick with it rather than face the prospect of starting over at a job you might actually love.
This is an example of a phenomenon known as escalation of commitment, also called sunk cost fallacy or commitment bias. It describes how we continue to invest ourselves and our resources in an endeavor that’s not working — whether it’s something related to our careers, our personal lives or other concerns. Why does it happen, and what does it look like?
What is escalation of commitment?
The terms was first used by Barry M. Staw in “Knee deep in the big muddy: A study of escalating commitment to a chosen course of action,” published in Organizational Behavior and Human Performance in 1976. It explains how we may continue to invest time, money, emotions and other resources into something that’s failing and not benefiting us. Instead, we look for ways to justify continued commitment, even when it’s not within our best interests.
Why does escalation of commitment occur?
There are several theories about why escalation of commitment occurs. They include:
• Self-justification/confirmation bias.
People value consistency and act accordingly to their previous behaviors. They justify their actions because they may have worked for them in the past — or they just can’t imagine any other possible course of action. We also look for evidence that what we’re doing is right, rather than ideas that contradict our beliefs.
• The need to be right.
People have trouble admitting when they’re wrong, and it’s easy to see how escalation of commitment is a byproduct of that difficulty. In some instances, we may dig in our heels and continue down unfavorable paths because we don’t want to admit we’re wrong about our decisions and choices.
• Emotional attachment.
Our emotions play a huge role in many of our decisions, and we become attached to our ideas. Sometimes, we may have difficulty letting go and recognizing that doing so is irrational or against our best interests.
• Difficulty accepting defeat.
Nobody likes to give up. We feel defeated and take it personally. So, rather than accept when something’s not working, we keep at it to avoid having to abandon our efforts and face failure.
4 examples of escalation of commitment.
1. Staying in a terrible job.
Going back to the initial example, sticking with a job that you hate is certainly an instance of escalation of commitment. You know that quitting and looking for a new job is an option, but you’ve invested so much time and effort into your role that it’s difficult to face the idea of just leaving. You’ve too worked hard to abandon ship — maybe you’ve even taken part in training or earned credentials to do this specific job — and it all seems like a waste if you just quit.
2. Staying in a terrible relationship.
Is there a sunk cost effect in committed relationships? According to a study published in Current Psychology: A Journal for Diverse Perspectives on Diverse Psychological Issues, the answer is yes. Researchers found that when the participants were faced with the choice of ending or remaining in an unhappy relationship, investing money and effort, and in some cases time, made them more willing to stay with their partners.
This is pretty common. You may know people who don’t seem particularly compatible or happy with one another, but they soldier on in their relationships because they’ve already put in the time, commitment and effort — and maybe they’re scared of starting over. Perhaps they even get married, despite the relationship not being a healthy one.
3. Making poor financial choices.
There are many poor decisions to be made when it comes to the world of finance, along with many examples of escalation of commitment. For instance, an investor might hold onto a stock too long because she made the initial decision to buy. Or, a venture capitalist might continue to back and support a project, despite it showing signs of failure.
4. Sticking with unsound business strategies.
Strategies often seem good in theory but don’t work in practice. Even if you’ve conducted extensive research and put in an enormous amount of effort toward structuring a plan, it could still fail. But in some cases, rather than changing course, an employee might tell herself that if she just puts in more time or money, the original strategy can still work — despite evidence to the contrary. This not only wastes resources but also means that rather than developing a new idea and working toward something that could potentially be a better option, the employee is continuing with the plan that’s failing.
Escalation of commitment is an easy trap to fall into; because we so badly want to prove ourselves right and avoid admitting defeat, we keep continuing down the wrong path and hoping that if we just go a little forward or put in a little more time or effort, we’ll succeed. But it’s important to recognize when something’s not working out. That way, we can start putting our energy toward an alternative that could end up being a much better choice.
You don’t want to stay in that dead-end job forever — instead, you could find a much better fit and a more supportive environment. It’s not going to end well if you commit to a toxic relationship because once upon a time, you felt differently about your partner. If you sense yourself going down this path, it’s important to try to avoid it. Pay attention to your intuition, which may help you separate your emotions from what you actually know about the situation. It can also be useful to consider it from an outside perspective. Ask yourself, “If my friend were staying in a relationship like this, what would I tell her?” This can also help you gain some perspective.