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Escalation of commitment

Human behavior pattern in which the participant takes on increasing risk

  • 14 min read
  • 5 chapters

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Economists and behavioral scientists use the related term sunk-cost fallacy to describe situations in which past, irrecoverable investments ("sunk costs") are used to justify further investment of money, time, or effort, even when new evidence suggests that continuing will yield worse outcomes than changing course.

In sociology and social psychology, similar patterns are sometimes called irrational escalation of commitment or commitment bias. The underlying idea is captured in expressions such as "If you find yourself in a hole, stop digging" and the warning against "throwing good money after bad". Researchers have also examined the opposite process, de-escalation of commitment, which concerns how individuals and organizations reduce or withdraw support from failing courses of action.

Early use

Escalation of commitment was first described by Barry M. Staw in his 1976 paper, "Knee deep in the big muddy: A study of escalating commitment to a chosen course of action".

Researchers, inspired by the work of Staw, conducted studies that tested factors, situations and causes of escalation of commitment. The research introduced other analyses of situations and how people approach problems and make decisions. Some of the earliest work stemmed from events in which this phenomenon had an effect and help explain the phenomenon.

Research and analysis

Over the past few decades, researchers have followed and analyzed many examples of the escalation of commitment to a situation. The heightened situations are explained in three elements. Firstly, a situation has a costly amount of resources such as time, money and people invested in the project. Next, past behavior leads up to an apex in time where the project has not met expectations or could be in a cautious state of decline. Lastly, these problems all force a decision-maker to make choices that include the options of continuing to pursue a project until completion by adding additional costs, or canceling the project altogether.

Researchers have also developed an argument regarding how escalation of commitment is observed in two different categories. Many researchers believe that the need to escalate resources is linked to expectancy theory. "According to such a viewpoint, decision makers assess the probability that additional resource allocations will lead to goal attainment, as well as the value of goal attainment (i.e., rewards minus costs), and thereby generate a subjective expected utility associated with the decision to allocate additional resources." The next phase of the escalation process is self-justification and rationalizing if the decision the leader made used resources well, if the resources being used were used to make positive change, and assuring themselves that the decision they chose was right. Leaders must balance costs and benefits of any problem to produce a final decision. What matters most often in assuring the leader that they made the right choice regardless of the outcome is if their decision is what others believed in.

Research conducted on the topic has been taken from many other forms and theories of psychology. Many believe that what researchers have done thus far to explain this behavior is best analyzed and tested through situational development and resource allocation.

Other research has identified circumstances that lead to the opposite of escalation of commitment, namely deescalation of commitment. This research explains the factors that influence whether escalation or deescalation of commitment is more likely to occur through the role of budgeting and mental accounting.

Vietnam War

Escalation of commitment can many times cause behavior change by means of locking into resources. In 1965, U.S. diplomat George Ball wrote to President Lyndon Johnson explaining that the South Vietnamese were losing the war, facing the United States with a decision between limiting U.S. liabilities by finding a way out at minimal long-term costs or, alternatively, accepting an open-ended commitment of U.S. forces:

The decision you face now is crucial. Once large numbers of U.S. troops are committed to direct combat, they will begin to take heavy casualties in a war they are ill equipped to fight in a noncooperative if not downright hostile countryside. Once we suffer large casualties, we will have started a well-nigh irreversible process. Our involvement will be so great that we cannot—without national humiliation—stop short of achieving our complete objectives. Of the two possibilities, I think humiliation would be more likely than the achievement of our objectives—even after we have paid terrible costs.

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