The sunk-cost fallacy keeps people for too long in poor jobs, unhappy marriages, and unpromising research projects.

Imagine a company that has already spent $50 million on a project. The project is now behind schedule and the forecasts of its ultimate returns are less favorable than at the initial planning stage. An additional investment of $60 million is required to give the project a chance. An alternative proposal is to invest the same amount in a new project

But the sunk cost effect makes us all, in ways big and small, build a track from nowhere to nowhere, refusing to quit because we don’t want to lose what we’ve already spent. It could be someone staying in their money pit of a house. Our track to nowhere could be refusing to quit our college major even though it’s making us unhappy, because we alrea