Commercial · Ohio University theatre subscriptions (Arkes & Blumer, 1985), In a field study that has become canonical, Arkes and Blumer sold season theatre subscriptions at three randomly assigned prices: full ($15), small discount ($13) and large discount ($8). Over the following six months, patrons who had paid the full price attended significantly more plays than those who had received a reduction. Only the money already spent, a sunk cost, explains the gap, since the value of each performance was identical for all. The commercial demonstration is crystal clear: the more a customer has paid, the more they "consume" so as not to waste their expenditure, a mechanic every seller can read in renewal behaviour.
Political · Concorde, prototype of the eponymous effect, The French and British governments committed colossal sums to the supersonic Concorde aircraft from the 1960s onwards. By the early 1970s, its unprofitable commercial operation was an established fact. Yet the programme was pursued for decades, justified by national prestige and above all by the expenditure already made. Dawkins and Carlisle named this behaviour the "Concorde effect" in 1976. It is the textbook case of the political weaponising of sunk cost: admitting the mistake became more unbearable than continuing to lose, and each party exploited it in the bilateral renegotiations.
Diplomatic · The escalation in Vietnam, read by Staw (1976), By titling his seminal article Knee-deep in the Big Muddy, after a protest song about the Vietnam War, Barry Staw makes the parallel explicit: the United States kept committing men and resources to a conflict with increasingly negative outcomes, partly so as not to devalue the sacrifices already made. Staw shows experimentally that an individual personally responsible for a prior decision reinvests more heavily in it. On the diplomatic level, the lesson is twofold: sunk cost locks one camp into escalation, and the opponent can play on that quagmire in the talks.
Judicial · The refusal to settle after two years of proceedings, In litigation, the bias is so common that mediators and firms make it a documented point of attention. A representative case: a party that has spent several hundred thousand euros in legal fees over two years refuses an otherwise reasonable settlement, on the grounds that accepting would amount to "wasting" that investment. Since the fees incurred are unrecoverable whatever the outcome, they should not weigh; yet they drive escalation. Mediators then refocus the parties on a future cost-benefit analysis, remaining costs, chances of success, expected gain, to defuse the trap.
Business · The IT project no one dares to stop, A major information-system overhaul goes off the rails: budget overrun, slipping deadlines, expected benefits revised downwards. At each steering committee, the question "should we stop?" runs up against the amount already sunk, and the budget is topped up so as "not to lose everything". The pattern corresponds exactly to the escalation of commitment described by Staw. The meta-analysis Cleaning Up the Big Muddy (Sleesman et al., 2012) confirms that the personal responsibility of the initial decision-makers and the desire for self-justification are among the major determinants of this costly persistence.
Everyday life · The two-ski-trips dilemma, In the original Arkes and Blumer experiment, participants are asked to imagine having bought two non-refundable ski passes for the same weekend: a $100 trip to Michigan and a $50 trip to Wisconsin, the latter judged more enjoyable. A majority choose the more expensive but less enjoyable trip, purely so as not to "lose" the $100. The weekend illustrates the bias in its purest state: both sums are spent whatever happens, and only the quality of the upcoming trip matters. Everyone replays it in the small trade-offs of daily life, finishing a dish one no longer enjoys, ploughing through a boring book "because one has started it".
