Tuesday, August 26, 2014


I have a friend who likes to justify certain decisions by invoking the sunk cost fallacy. The problem is she gets it backwards every time. I've tried to explain it to her, that she's embracing the fallacy, not acting in opposition to it, but I have had no luck.

Maybe economists aren't good for all that much, but they've managed to formalize a few good ideas. One is that the fact that you've dug a big hole doesn't necessarily mean you need to keep digging.