Sunk Cost Effects in Consumer Decisions: Role of Anticipated Regret
A prior cost or investment that already occurred in the past should not influence a current decision. Yet, it often exerts a strong influence. This “sunk cost” effect has previously been demonstrated over numerous settings. Three experiments in this paper examined mediating processes for the effect. Experiment 1 employed self-report measures of various alternative mediators and provided initial evidence that decision makers’ anticipated regret from inaction might be responsible for the effect. Experiments 2-3 then examined the regulatory focus (promotion vs. prevention focus) as a potential moderator for the sunk cost effect, and showed that the effect was restricted to the conditions in which participants’ regulatory focus matched the nature of the decision target (i.e., when there was a “regulatory fit”). These and other results indicated that decision makers’ anticipated regret from inaction decisions is the reason for the sunk cost effect.
Junsik Kwak (2008) ,"Sunk Cost Effects in Consumer Decisions: Role of Anticipated Regret", in NA - Advances in Consumer Research Volume 35, eds. Angela Y. Lee and Dilip Soman, Duluth, MN : Association for Consumer Research, Pages: 719-719.
Junsik Kwak, Dongseo University, Korea
NA - Advances in Consumer Research Volume 35 | 2008
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