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Social Studies skills: Difference between revisions

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*** this dynamic can explain why people may feel great about some outcome yet fail to repeat it subsequently
*** this dynamic can explain why people may feel great about some outcome yet fail to repeat it subsequently
**** they expect that same extreme/outlier without realizing that outcomes will likely "regress to the mean"
**** they expect that same extreme/outlier without realizing that outcomes will likely "regress to the mean"
=== Sunk cost fallacy ===
* "sunk cost" is an economics term for a transaction or financial cost that can no longer be recovered
** i.e., it is "sunk"
* the "sunk cost fallacy" is that because a cost has been incurrent but not recovered, more investment is required to make it back
** also known as "throwing good money after bad"
* the sunk cost fallacy results from an emotional response to a bad situation
** in which it would be irrational to continue to incur additional costs
* the opposite response to the sunk cost fallacy is "cutting one's losses" and moving on
* in non-financial analysis, especially historical, the sunk cost fallacy occurs when actors "double down" on a bad decision or situation
** doubling down has frequently occurred in politics and warfare
* related to Loss Aversion


=== Sutton's law ===
=== Sutton's law ===