Case file
Escalation of Commitment
- Filed under
- Need To Act Fast
- Also recorded as
- Irrational escalation
The charge
We intensify commitment to a bad decision after negative feedback instead of cutting losses.
How it operates
Ego, public commitment, and the hope of vindication make doubling down feel better than admitting error.
Logged incidents
- Incident 01
An executive adds budget to a failing expansion to avoid signaling a mistake.
- Incident 02
A founder keeps hiring into an unproven market after repeated misses.
- Incident 03
A PM extends a weak beta again instead of retiring the product.
What to watch for
Look for rising commitment that seems driven by the need to justify the earlier call. Ask: 'Am I increasing investment mainly to avoid admitting I was wrong?'
Recommended action
Set stop-loss rules in advance and use independent review for continuation decisions.
Known associates
- Sunk Cost FallacyWe continue a failing course of action because we have already invested time, money, or effort in it.
- Generation EffectWe remember and often value ideas more when we generate them ourselves rather than simply receive them.
- Loss AversionLosses usually hurt more than equivalent gains feel good, so we work harder to avoid losses than to pursue…
- IKEA EffectWe overvalue things we partly built ourselves.
- Unit BiasWe assume the provided unit, package size, or chunk is the right amount to consume, buy, or complete.
- Zero-Risk BiasWe prefer eliminating a small risk completely over achieving a larger total reduction in risk.
Source of record