Arkes, H.R., and C. Blumer (1985). "The Psychology of Sunk Cost", Organizational Behavior and Human Decision Processes 35: 124-140.  Home/Search   Document Not in Database   Summary   Related Articles

....theater has doubled) if they lose a 10 ticket S =S log2 S While may be too small to outweigh E 0 X, this is less likely to h k 0 h S occur in the second case. Other striking examples of the influence of sunk costs on current decisions have been reported by Thaler (1980, 1987 ; 112) and Arkes and Blumer (1985). They found that the attendance to a baseball game or theater plays was significantly more regular when the spectator had bought his tickets full price than when he had 13 got them free or with a discount. The two groups of subjects are facing the same objective surprises but those who purchased ....

....notion, see LvyGarboua, Montmarquette 1995a) so that their marginal rate of substitution between the live show and other goods should be less responsive to exogenous changes. The subjective surprise would then be smaller in absolute terms for the first group of live show lovers. Interestingly, Arkes and Blumer (1985) noticed that the sunk cost effect fades away in the long run. Attendance to the first five plays of a season of ten plays was significantly reduced by the price discounting, but this effect was not significant for the second half of the season. This last observation is fully consistent with a ....

Arkes, H.R., and C. Blumer (1985). "The Psychology of Sunk Cost", Organizational Behavior and Human Decision Processes 35: 124-140.

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