THE EFFECT OF GOAL DISTANCE ON GOAL VALUE AND ESCALATION OF COMMITMENT

Abstract

Escalation of commitment describes individuals' tendencies to persist in a chosen course of action. The traditional account of escalation of commitment assumes that sunk cost is the primary antecedent for this behavior. However, it has been noted that high sunk costs are confounded with progress made toward a goal and hidden payoff information. Thus, the apparent escalation tendency may be a consequence of goal proximity and information search rather than of sunk costs. Experiments 1 and 2 show that individuals' tendencies to escalate reflect the classical goal-gradient effect after controlling for the sunk costs. Moreover, Experiment 1 also shows that controlling for progress toward the goal, increased sunk costs decreases escalation. In addition, Experiment 2 shows that individuals attribute more value to the goal as they get closer to it, thus providing an alternative explanation for escalation of commitment. Experiments 3a and 3b demonstrate that individuals committed to a course also devalue other course of actions not chosen. These results suggest a new interpretation for escalation of commitment and new approaches to guiding people to avoid it.