The sunk or lost cost in economics refers to those retrospective expenses that have been made and that cannot be recovered over time. According to the Economipedia, sunk costs include money, time ...

Reviewed by Margaret James In accounting, finance, and economics, all sunk costs are fixed costs. However, not all fixed costs are considered to be sunk. The defining characteristic of sunk costs ...

Find out about sunk costs and why "getting your money's worth" can cost you more than you think.

A major way that the sunk cost fallacy hurts finances is by causing investors to stay committed to a misguided investment for too long or even allocate more to chase losses.

The sunk cost fallacy addresses the tendency of people to continue on a suboptimal path because they have committed a lot of time or resources to it already. Investors, for example, may double ...

Sales is all about the art of closing the deal. Behind the curtain, that means a lot of patience, persuasion and persistence.

In the field of economics, the sunk cost fallacy — also called the sunk cost effect — is notorious. It occurs whenever we double down on poor financial decisions based on past investments that can't ...

The sunk cost fallacy is when you throw resources into a losing venture because you've already spent time or money.

The term sunk cost fallacy was coined in 1980 by Richard Thaler, who received a Nobel Prize in 2017 for his pioneering work in behavioral economics. It describes how cognitive biases can lead ...

What is behavioral economics? Behavioral economics is grounded in empirical observations of human behavior, which have demonstrated that people do not always make what neoclassical economists consider ...

While the examples above may seem relatively trivial, they show how common the sunk cost fallacy is. And it can affect decisions with much higher stakes in our lives.