Musings of Navigating The Finite remainder of life from Porchville, with the hope of a glimpse of The Infinite

Wednesday, February 25, 2015

Sunk Cost Fallacy

I enjoy when I am reading a book and I learn something serendipitously.   I especially like when it is something that labels and defines an experience that we all have and perhaps even suspect that we are deluding ourselves but never quite examine in the full light of conscious inquiry.
Image Credit:

Most of us have had the experience of engaging in the consumption of something beyond our desire because we have paid for it, cannot get our money back, and feel obligated to get our money's worth...eating too much at a restaurant, watching a crappy movie to its end, or finishing a lousy book for example.

I am reading The Rosie Affect: A Novel  by Graeme Simsion, which is not a lousy book, and I ran across this passage:

Sonia was an accountant. She would understand the logic of decision making. I took Rosie’s spreadsheet from my pocket and gave it to her. She held it with one hand while steadying the baby with the other. I was impressed with her proficiency after such a short period.
“My God, you guys are both nuts,” she said. “Which is why you should be together.” She looked at the spreadsheet for a few more seconds. “What’s this about already purchased the air ticket?”
 “Rosie’s ticket was nonrefundable . She felt obliged not to waste the investment. It was obviously a factor in her decision to go home.” 
“You’d break up over the price of an air ticket? Anyway, she’s wrong. It’s the sunk-cost fallacy. You don’t take nonrecoupable costs into account in making investment decisions. What’s gone is gone.”

Simsion, Graeme (2014-12-30). The Rosie Effect: A Novel (Don Tillman Book 2) (p. 300). Simon & Schuster. Kindle Edition.

So I wondered, gee is there really such a thing as a sunk cost fallacy.  Indeed there is and here is an excellent description of it as it affects normal people in normal life (rather than an economic consideration for business that is described in Wikipedia)., How the sunk cost fallacy makes you act stupid, Michael Davidson

I have a good example of sunk cost fallacy that happened to me about 15 years ago.  I bought a digital watch that changed the display mode by rotating the bezel around the dial.  That seemed cool, instead of punching little buttons to get the various modes, you twisted the bezel one direction or the other.  Another plus for this watch (not the one in the photo below) was that it had rather large digits so I could see the time without my glasses which are only needed for reading.  My wife, who is rarely with me when I shop for watches, said "Don't buy that. You will be unhappy with that mode ring." Fateful words, I didn't listen.  

Not my watch but similar.  Note the arrows on the bezel. 

I bought the watch and yes I could easily see what time it was at a glance, those big digits were easy to see. The watch was really cool, it had all these modes, one of which was the time. The only trouble was that the ring constantly got bumped and if there was 5 modes, that meant at best, a glance at my watch yielded the current time only on 20% of the glances.  So I would be at a boring meeting and I would casually sneak a  look at my watch and 80% of the time I would see Th 3-12,  or LAP 8 - 20:17:39, or 99:99:59.999, or ALM 05:50 AM and every once in a while the time. After the end of my first day with the watch, I thought maybe my wife is right, this watch could be a PIA.  Ahhh you will get used to it. Give it a chance.  

By the time I had it for 3 months, "this f---ing watch is driving me crazy." Then I thought of an elaborate plan. We had a product at work that with the test fixturing installed weighed 48 tons. I was going to set the watch on the floor and have the techs set the test article on the watch with the crane. Meanwhile I had to wait for this product to come to our department, we only built a few of these monsters every year.  We had plenty of  10 ton or 20 ton units, but I wanted to destroy that damned watch with the big guy.   Insanely due to sunk cost fallacy, I continued to use the watch while waiting for this humongous product to show up in our department.   May as well get my money's worth while waiting to destroy it. 

Again not my watch, but mine sort of looked like this. 

One day I looked at the watch and it said 63:37:12.107...108...109 changing every millisecond. I procured a ziplock bag and borrowed a 4 pound rawhide mallet from one of the techs. I put the watch in a vice and beat the f--- out of it with that mallet. Like Ralphy Parker during the Scot Farkus incident, "I have since heard of people under extreme duress speaking in strange tongues. I became conscious that a steady torrent of obscenities and swearing of all kinds was pouring out of me as I screamed"* at the top of my lungs while swinging away at the watch with Garland's finest rawhide mallet. After several minutes of beating and swearing, I collected the remains of the watch put them in the bag, and calmly returned the mallet to the tech. I stopped on the way home from work and bought the watch my wife wanted me to buy, the digits were smaller but the modes were set with tiny buttons. I returned home and handed her the bag of shattered watch parts and said "you were right." 

Every now an again we will have a discussion in which we have divergent opinions. My wife will disappear for a moment and return with a zip lock bag with a bunch of shattered black plastic and tiny circuit boards and shake it at me. End of argument, she wins.  

The lesson: do not arm a woman with a physical example of your sunk cost fallacy. 

Garland Model 31004
Image Credit.  MSC.Direct

For those readers with an interest in tools, the mallet of choice for an operation like this is a Garland Model 31004 it is available at MSC Industrial Supply Company:

It has a 4 pound head weight, 2" rawhide faces (dipped in some sort of adhesive making it very tough and resilient),  a 14 inch hickory handle, and (at the time I was buying them) made in the USA.    What I like about this hammer is that you can get a tremendous amount of impact force with very little glancing.  Behind the replaceable rawhide faces is a solid steel mass.   You have very good control over the hammer especially after some use and the rawhide ends begin to mushroom.   As a result it is a very safe hammer for applying heavy shock to an object, and I found the hammer to deliver little return impact to your hands and arms.   I could do more work with a 4 pound rawhide mallet than I could with sledge hammer which requires a lot of strength and good control.  Another thing I like about these hammers, the head attachment to the handle is very durable.  I have never seen a loose head in the many units we had at work.  The only disadvantage I encountered with this hammer is that after a while the ends mushroom which actually makes the hammer more stable and less given to glancing, but the rawhide will pulverize with each blow and leave particulate on the work surface.  For applications requiring a high level of cleanliness, this hammer is ill-advised.  Also you will note that the hammer is fairly pricey.  Alas, being retired,  I no longer have access to one. 

BTW, Amazon also carries Garland hammers and mallets, but I doubt that you can buy The Rosie Effect at MSC.   

For smashing watches that have pissed you off, this hammer is highly recommended.   Generally when I get into one of these endeavors, I am by definition rather angry and anger is always a poor time to pursue any task, but especially one that involves striking with a hammer.  Due to the inherent safety of this hammer mostly from its resistance to glancing, and the non-marring quality of the ends, it is highly recommend for the smashing of watches in your vice.  Remember, always wear approved eye protection when using a hammer. 

I must offer a caveat.  I highly recommend not smashing your watch.  All digital and most analogue watches have a battery, which is often lithium or some other toxic material.   If you simply must smash the watch, please remove and properly dispose of the battery prior to smashing it.


Cover, The Rosie Effect:

Timex watch with rotating bezel mode selector:


  1. Mike was of the gold pocket watch persuasion and as far as I know never wore a wrist watch. I do not own a working watch of any sort--the major advantage of retirement as far as I am concerned. That, and not needing a rawhide hammer. There is not even an alarm clock in the bedroom anymore. Mike would never have stood for that. He had to know the time always. Now if I wake up and it is still dark, I don't care what the time might be. I know I can just roll over and go back to sleep. If I wake up and it is light, I get up.

  2. I seldom wear a watch anymore. Mine died last month and I haven't got around to replacing it. I agree with Mike on the clock in the bedroom though. If I wake up, it will drive me crazy if I can't tell what time it is. Why? Who knows, but I won't be able to go back to sleep until I see what time it is. That digital system sounds good, if it is dark go back to sleep, daylight get up. Simplicity is the best method. Olga, always a pleasure, thanks for stopping by and commenting.

  3. What's a bezel? Hi Sextant - that's just to prove I read your post carefully. Can't survive without knowing the exact time every ten minutes myself. Always been this way. It's supposed to make me more efficient.

    1. Fiftyodd,

      The bezel is the outer most ring on the face of the watch. If you click on the watch photo above, you will see a silver surface that says turn to change and has the name and depth...the bezel is the black plastic ring with the arrows imprinted on it on the outer edge of that silver surface. On some watches, they have bezels with the directions N E S W printed on them. Some have a chronometer memory settings for divers. Usually on cheap watches it is just a bunch of crap to make the watch to appear hi tech.

      Why do you need to be efficient now that you are retired? Buy that hammer and smash those time keepers!

      Great hearing from you.

    2. Nah, still feel pressured. Can't 'waste' a day without feeling my parents' disapproving eyes upon me.

    3. Alas, the eternal disapproving eyes. I prescribe a period of enforced sloth. Failing in that there is always the dolphin, that will avert their eyes.

  4. What I'd like to know is how the rest of your work place reacted when you took out your temper tantrum on said watch ? :)
    I know I have been on the receiving end of the sunk cost fallacy more than I like to admit. It's real for sure.
    ....and I haven't worn a watch for years, although I have a few old digital watches kicking around the place somewhere that could use a good smashing, but only cause you brought up the idea. Actually with my watches it was always the bracelet breaking and/or the crystal getting scratched.
    Sextant, your hilarious as always.

    1. There were only a couple of guys in the area, which was large and very noisy and me having an obscenity fest was pretty much SOP. My office mates had calluses on their ears. I would get off the phone and have a two minute commentary on the person or situation peppered with obscenity. So that was nothing more than usual weather for me.

      Having a name and a definition for a situation is very useful in avoiding it. Another one I ran into recently is called risk compensation. My car is one of the insurance industries top picks for safety. As I result I feel very safe in it and end up driving 10 mph faster than I would if I had an old beater. You see this a lot with folks with 4 wheel drive in the winter. Yes you can go better, but you can't stop any better...we all have 4 wheel brakes.

      Yes, I used to go through watch bands, now I just replace the watch. The usual pattern was that the band would go, I would replace it, a month later the battery would go, and (because I just replaced the band-- a sunk cost) I would replace the battery. So now I have half the price of a new watch invested and the watch would invariably fail within 30 to 60 days of replacing the battery. Now I shit can the watch and buy a new one the first sign of trouble. I wear them so infrequently that the bands are holding up, its just the battery dies. I never spend more than $40 on a watch, they last 3 to 4 years, and are acceptably accurate. Having the time on one's cell phone pretty much eliminates any absolute need for a watch.

    2. ...Except if you can't find your cell phone.

    3. But what if you can't find your watch and your cell phone? Time will go on, the sun will rise and set. Time and tide awaits no woman no matter how closely you watch it.

  5. I don't wear a watch, never have but I have a great watch story. A long time ago my mom gave me her gold watch. It was a very expensive watch that my dad bought for her at Sears. I believe she gave it to me when I was 14 years old. It had the little winder thingy on it and first thing I did was wind and wind and wind until I over wound it and it wouldn't work anymore.

    My mom said that was it, it was broken. I continued to wear it only because my mom had had the watch attached to an ID bracelet with my name on it.

    One day while watching the Mike Douglas show on TV they said there was going to be a very special guest coming on and if we had any broken items, watches, radios, etc gather them and be ready for a surprise. So my mom remembered the watch and told me to go get it.

    When this guy came on the tv we realized he was a psychic and he explained that if we held on to the broken item and really concentrated on fixing it with our minds that with his help we could fix it. So I held the watch between my index finger on my right hand and my thumb and I believed! I concentrated and kept repeating in my head, "please fix, please fix" and you know what? It fixed. The watch started working and it still works to this day! So what do you think fixed it? The psychic, my prayer or dumb luck? Who knows.

    1. What do I think fixed it?

      1) You did by applying heat and pressure to the case with your index finger and thumb which allowed a jammed component in the gear train to free up.

      2) The psychic through you and your mother. He sent out psychic energy in the form of quantum bundles vibrating at a frequency of 1.9137 X 10 ^ 87 Hz. You being young and your mother being older formed a dipole of Goddess reception of the maiden and the crone. A rainbow with a median frequency noted above (as the center color) formed between your auras. The energy caused the watch to vibrate at the said frequency and loosened the jammed part.

      3) I refer you to the Edward Tryon quote on the sidebar. Shit happens.

      Take your choice. I am sort of leaning to explanation # 2. There is much in the world that we don't understand.

      I think a true test of this guy's ability would be to hold my bag of smashed parts and see if he could get them to work again. If not we could always blame the fact that I probably missed a few parts when collecting the pieces.

      Regardless of what actually fixed the watch, it is a cool story. Thanks for stopping by and commenting Alicia.