Imagine you bought tickets to see a movie. For the sake of authenticity, let’s say the movie was ‘Daddy’s Home 2’. With each passing minute, you realise Mark Wahlberg and Will Farrell accepted their parts in order to cash a cheque rather than vie for an Oscar.*
Since you’ve already bought the ticket, do you stay just to get your money’s worth, or do you leave and do something more meaningful with your time? The price you paid for the ticket should not affect your decision because the ticket is a sunk cost.
What is a sunk cost?
In economic terms, a sunk cost is a cost that has already been incurred and can’t be recovered. People fall into the sunk cost fallacy when they base their decisions on past behaviour.
We sometimes invest even further in a futile attempt to make the initial decision seem worthwhile. This can happen in the stock market, but it also happens in relationships.
What does a sunk cost have to do with relationships?
A study in 2016 found that people are more likely to stay in an unhappy relationship if they feel like they’ve invested significant amounts of time, money or effort.
What happened in the study?
Just under 1,000 participants were presented with four different scenarios of a marriage that was unhappy and increasingly sexless.
- The first were told only that the marriage had lasted ten years (control)
- the second were told both partners had made a huge effort to change the situation by showing more attention to each other and giving gifts (effort)
- the third group were told the couple had purchased a house together (money) and
- the fourth group were told that the marriage was only one year old (time).
The results showed that 35 percent of those faced with the effort and money conditions would stay with the partner and 25 percent of those in the time and control groups would stay.
This study suggests that people are more likely to walk away from a shorter marriage than a longer one – or if they don’t think they’ve invested a significant amount of effort or money into the relationship.
In a second experiment, 275 participants were presented with two different scenarios, based solely on relationship length – an unhappy marriage of ten years versus one year. They were then asked to share how long, in days, they thought they’d stay in the unhappy marriage.
The ten-year group would invest about a year-and-a-half into trying to save a floundering relationship. The one-year group, in contrast, would work at it for nine and a half months before ending the relationship.
So if you’ve been wondering why your friend is still with that terrible boyfriend or girlfriend, they may be grappling with the sunk cost fallacy.
*I have not seen ‘Daddy’s Home 2’ but from a cursory glance have deduced that it’s a pile of sh*t.