Sunk Cost: The Phenomenon that Continues to Drive People to the Worst

  The “Sunk Cost” fallacy has been a old and regular saying among many statisticians that has become common in humans today. The main place we see this phenomenon is in gambling. Many casinos use it in manipulative ways such as using flashing lights, or displaying previous winners, but most importantly just how the games are staged. Most games are built with rules to just barely delivery defeat to those playing, but this ride on the edge brings many players to go further, to push their odds and claim that they are “due” for a win, despite the odds being the same before and after playing. Many scientists have researched if this fallacy has an application in other species, or if humans are solely driven by these irrational thoughts. Many believe it to be the ladder, however research may show that its more complicated than you think.

Dr. Brian Sweis in his article Sensitivity to “Sunk Costs” in Mice, Rats, and Humans explains an experiment his lab conducted on both mice and rats as well as humans in order to see if these rodents have these thoughts too. The rodents were placed in a contraption called “restaurant row”, a room system connected with hallways, each with an offer of food. Each food pellet was flavored differently, and mice were offered a pellet when entering the room. They could either accept the pellet and eat it, or skip the wait and move onto the next room. Humans were given a similar task, as they were given 4 different categories of videos to watch and could either skip what they were offered, or watch the video. The humans specifically were told to rate the categories 1-4 after. Through both experiments, Dr Sweis was able to determine that there was actually some sort of mechanisms in the brain related to dealing with these problems, and that humans and rodents have very similar processes in pushing forward and invest more time and effort into completing a task with no actual guarantee of a solution. 

Further research from Koen Dijkstra and Ying-yi Hong in their article The Feeling of Throwing Good Money After Bad: The Role Of Affective Reaction in the Sunk Cost Fallacy further develops the idea around why people are affected by this and why it may stimulate further doing so. One of these ideas was that the sunk cost fallacy was built upon emotions of regret and guilt. This mainly relates to the gambling side of things, as there is guilt around losing maybe a families house, car or even life's savings in a game, and the phenomenon pushes those to continue to double down and try to regain those savings, or even try to win more. Another thing they bring up is when you are at a restaurant, despite eating the rest of the meal and being full, some people still cram a desert in. Even though they know they are full, sunk cost essentially tells them that this will be worth it. In the end, sometimes you end up overeating, sometimes you don’t, but the taste was still the same. There is a lot of research behind how the brain works around this phenomenon and its not just in Neuroscience. Psychologists try to understand as well why the brain does this in order to make predictions, as well as understand how to prevent things from happening.

Both the articles identify how strong this fallacy is, and how its not just a small thought process. This idea is wired into our brains in some way that maybe we will fully understand someday why it is. This idea that we are drawn towards doing something over and over again, despite the idea of failure, bad things or anything can happen. Gambling already has its issues, but the fact that we are drawn to lose more based on losing is an issue that needs to be understood. Even further is how strong this phenomenon is. If you lose $1000, the sunk cost fallacy draws use to spend more, and take bigger risks. There is no guarantee a wanted result is ever going to occur, and doubling down has the same odds as the first go, yet we are more enticed to go back even though we know something could go worse. That explanation itself sounds like an addiction, which is why it's often paired with it. Numerous times the rush of a win, or the striving to end a loss streak is what leads to addictions to things like gambling, and the sunk cost fallacy is whats turning the wheel.

References

Dijkstra, Koen, and Ying-Yi Hong. “The Feeling of Throwing Good Money after Bad: The Role of Affective Reaction in the Sunk-Cost Fallacy.” PloS One, U.S. National Library of Medicine, 8 Jan. 2019, https://pmc.ncbi.nlm.nih.gov/articles/PMC6324799/ Accessed 30 April, 2025.

Sweis, B. M., Abram, S. V., Schmidt, B. J., Seeland, K. D., MacDonald, A. W., Thomas, M. J., & Redish, A. D.“Sensitivity to “Sunk Costs” in Mice, Rats, and Humans” Science, https://www.science.org/doi/10.1126/science.aar8644 . Accessed 30 April, 2025.