Know When To Quit - The Sunk Cost Fallacy
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- Опубліковано 30 чер 2020
- Let's say you buy a $10 movie ticket.
But 15 minutes in, you realise this movie isn't what you expected it to be.
However, because you feel like you're supposed to get your money's worth, you decide to watch the rest of the 2 hour movie.
This decision is based on your loss of $10.
But it isn't an optimal one.
A more logical thing to do, would have been to get up and leave after you had realised this movie wasn't what you wanted to watch.
Wouldn't you be better off, had you only wasted $10 and 15 minutes of your time, instead of wasting $10 and 2 hours?
Had you left early, you would've essentially gained 2 hours of extra time.
Those $10 you spent were gone or "sunk" either way. You couldn't get them back, whether you watched the rest of the movie or not.
And that phenomenon is what psychologists and economists call: the sunk cost fallacy.
It's one of the more common cognitive biases that clouds our judgement.
Instead of making a decision based on potential future returns, we make them on our past losses.
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You didn't waste time. You invested it and learned something about yourself: you want to do something different. The waste is choosing to continue after you learned this.
LOL
Learning how to take a loss and moving on is such an important life skill to have!
You are totally on point Mrs!!!
But it's very hard to learn
“Sometimes people don't want to hear the truth because they don't want their illusions destroyed.”
― Friedrich Nietzsche
we get it, you have quotes, you don't need to put a whole bunch on the same video at once.
Books in review that's most the time. Rarely do they really wanna hear the truth, they think they do until they hear it.
Slaughterhouse. plz put cute cow smiling on milk carboard
Great quote by a man worth reading.
bRAH, not knowing is fucking worse!
Yep, gambling is build on this principle - as player loses he strives to regain those losses and loses even more
so true i am stuck for so long trying to get it back to feel happy and content again which is a trap of the mind now i realize
Absolutely true
But what if they do win? I don't think gambling is sunk cost. Time and (non-refundable) money are sunk costs because you cannot get them back. Gambling, there is a chance (albeit incredibly slim) to get it back, therefore it's not sunk yet.
@@Don-IV The money you lost gambling doesn't make it more probable you will win the next time. It is not an investment, just money you allready spent.
It's true the argument doesn't deal with absolute certainties but with probabilities. You might win next time you gamble, but you probably wont. You might make your relationship good by trying even more, but you probably wont. Etc. Learning from your experiences is a good way to go. :)
@@sofialovisa6906 sorry, misread the original comment. I thought they were talking specifically about the term "sunk costs" as opposed to the overall principle of the video.
I also agree with you, but i wasn't speaking about probability. Sunk cost cannot be recovered i.e. non refundable purchase or time spent in a relationship.
I still don't think gambling is completely a sunk cost though i.e. if someone played a 50/50 game, and doubled their previous bet everytime they lost, eventually they would recover their loss (although I understand this is impossible in reality due to gambling rules and the human life span 🤣 so i guess you're right practically, but not in theory 😅)
I remember when I had this same realization with regards to reading certain books. I ALWAYS finished every book I read, and then I realized that I was under no obligation to finish a book I did not enjoy. Now I give it 1/4 of the book to win me over. At that point, if I'm not getting anything out of it, enjoying it, or really compelled to continue, I just set the book aside and quit. It has been quite freeing for me.
Interesting take. I imagine creators would argue that you should give the entirety a chance (what if a super slow start somehow builds up the bestcending ever?)
But you have finite time, and if you have many books than it makes sense to have to "vet" them.
Interesting interpretation.
Years ago, I read someone's rules about reading books. I only remember the last one, which was: "You don't have to finish it." This came as a surprise, as I always thought once I opened it, I should stick it out to the bitter end. But now I don't do that, and I find it has freed me to feel okay about trying ANY book, knowing I don't have to make the commitment.
One might argue that it could be the same as giving up but in reality, it isn’t. You’re simply acknowledging the fact that what you are currently doing isn’t aligned with your life goals. Sure, you may have wasted time, but by moving on early, you’ll save more time in the long run.
The first mistake you make is to search for holiday trips after you have booked one already. Don't do that!
Grandma has spoken.
So right! The fact that they kept looking is a signal that they weren't truly happy though...
you're so right he should have checked the date and details obviously
@@farhanarahman9375 greedy noob error. Who the hell books two holidays at once?
I've only walked out of two films ever. Nearly always something I can learn from a film.
I sat through "Sphere" in retrospect I should have left but that was two decades ago now so it's not something that concerns me anymore.
Still annoyed I left my sausages on the bus coming home drunk but that wasn't even 4 years ago yet and they were the nice ones with caramelised onions inside.
If you will excuse me I am going to punch a wall in frustration until my knuckles are broken... 555
Better advice is to have patience in considering about purchases.
I am familiar with the sunk cost fallacy but this is the best explanation I've ever had :) Thank you!
My life is divided in 2 parts
1) Before *BETTER THAN YESTERDAY*
2) After *BETTER THAN YESTERDAY*
But the question is....are you BeTtEr tHaN YeStErDay?!?!
@@A-Pro100 well actually I try it every time but do not succeed every time😜
And the next day....and the next day
@@PerfectSPR actually u are cuz the first step towards the change is to want change, if you want change in ur life so yes ur better than yesterday
My paradigm was shattered after watching this video. Most of humanity's problems would be solved if we could let go of the past...
What are you hoping to accomplish by holding onto the past?? Seriously
That's a priority with some people to destroy the past. In order to replace something you must do away with the history. In order to make America Fascist or Communist you must remove the Founding Father's and why we are a Constitutional Republic.
The past doesn't exist. Only the present does. Whether or not the 'past' affects you is totally up to you. Once you truly realize that, your new life begins. I recommend you all read Eckhart Tolle - The Power of Now. Go order it now.
@@briansmith9258 great question actually.. Guess it has something to do with psychological making the inner-kid happy?
I really needed to see this video today, been jobsearching for the past 2 months and holding onto i have to do something i should do having a bachelor's degree and a quite well brain capacity... however though; i like practics better cause i view life from a "distance"; do i prefer sitting in an office for most of my life or interacting with people - actually DOING things.🤷🏼♀️ This video just helped me realize to focus on how to spent the hours (and lifetime) coming, in stead of feeling guilty towards something i don't wanna do anymore... Thankyou!
That is every time you're at a restaurant and order too much to eat, eat it all up because I just as well payed for it xD I'm trying ot think that I actually spent money to be happy, and if I'm happy with less food than I ordered, then I shouldn't force myself to eat more. :)
That's absolutely right 😄
In such a case i kindly ask if i can take the remaining food with me to eat later at home. In some restaurants they even ask you if you want to take it home.
Sunk Cost is probably a result of our dopamine system. You'd think that being given $100 and then losing it again immediately shouldn't affect your mood, because you're in the same situation as 2 minutes ago.
But in reality, your brain has released dopamine because of the anticipated use of $100. When the money is withdrawn, that feels to the brain like a real loss, because suddenly the dopamine stops squirting (sorry). And the end of a dopamine rush results in a rebound feeling, depending on the size of the dopamine release.
So that's why we keep doing this unuseful behaviour.
“It is the time you have wasted for your rose that makes your rose so important.”
― Antoine de Saint-Exupéry, The Little Prince
The common saying, 'throwing good money after bad', gains new insight/value to me now. Thanks!
The BEST EVERY explanation of the sunk cost fallacy. So revealing and so true...a really great lesson to know when to end it all despite the wasted time, money and effort that's a fact that can never be changed...so time to get over it.
Its odd how channels that teach us life lessons have such a small social image compared to accounts that post nothing but video games and time wasting videos.
Tru
Maybe it shows what the priorities are in our modern culture.. makes you think
That is soo true and unfortunately you can see it in many aspects of your life outside UA-cam. For example, there are nail artists that make more money than teachers in Greece. I guess it is in our hands as users to promote this kind of content and slowly change that.
Not surprising at all, sports stars and movie stars have salaries thousands times bigger than the best educators, researchers and health workers... Most of the world value more entertainment than wisdom
Very true
Can honestly relate with what you said at 7:25 with battlepasses in games, specifically in Fortnite and Apex Legends. Didn't enjoy Fortnite anymore, but still played it and grinded it because I felt like I had to finish the battle passes. Quit Fortnite around 1 year ago, but I still play Apex Legends because it's fun, but don't do challenges anymore just because I have to.
Usually whenever I watch a video on UA-cam, they always feel so long full of rambling and it'd take too much of my time to finish them. It's not the case with yours though, what fascinates me with all of your content is that it doesn't feel like I just spent 9 minutes to watch a 9-minute video. I believe this is what knowledge on story telling and caring about your audience gives you.
It turns out that being a good at story telling can do wonders. People, including me, tend to forget that there is a craft in delivery. Take for instance what happens when you hear a presentation by someone who talks fast compare to one who talks moderately fast, you'd digest much more with the latter. Good delivery gives good connection with the audience, I was so engaged in your content that I just forgot about everything else. From my analysis, this could happen only because you not only paid attention to the story telling but also knowing your audience well.
This shocks me awake. The fact that paying attention to your audience gives you a high engagement in return. I should've known this because I had the same unconscious impulse whenever I talk to my little brothers. Whenever I teach them about something, I would always use examples that are closest to them. This in turn makes it easier for them to digest the topic of discussion.
I learned a lot from this video, not only about "The Sunk Cost Fallacy" but also in your delivery and meticulousness in making your content fit the audience. Thank you for Better Than Yesterday team for the video. Cheers.
I spent almost 5 years in such a bad relationship while I could end it within 2 years. Now repenting for the time. Just had hoped I could fix the problems but at last realized it was not only upto me. Then I quit.
Same
I know, I know but the most sucks thing is knowing it after we messed up...many times.
I can relate to this sunk cost fallacy in relationship. 😢I failed to see the future potential returns, but instead I was too fixated on my past effort in the relationship. That’s why I had a deep heartbreak when my ex broke up with me. I also felt exhausted and drained for trying to make it work, not knowing that letting go would be more peaceful for me. Relationship problem is definitely one of the things in our life that haunts us most.
you made me realize i held on too so many things that went bad .. much love to you for making these very original and awesome explained videos
same here, a real eyeopener
This channel has already taught me more than my school
This blew my mind. And it completly changed my way of thinking
I had never heard of sunk cost fallacy before. However, it clearly explains why we hold on and don't cut our losses. The money has already been spent. Thank you for a new perspective.
I swear this video is for me.
Currently making a decision to drop my study in mathematical physics since I have been getting lowish grades and mostly because I'm hating it.
Thinking about computer science since I actually enjoyed mucking around with the code. Thinking cryptography since I already have the maths major completed.
This opened my eyes. My reasons are my own, but I'm sure my life will change dramatically in a next week. Thank you for this. This ment a lot!
this needs to be educated in schools ... and there are no words can explain how much you helped me right now thanks to the moon
I know about this fallacy, but I bet I'll still fall for it in the future.
This was so well-explained, my God! The narrator's accent (Italian, I'm guessing), voice and candence is so soothing. It literally lifted my mood. Thank you, to the entire team of ladies and gentlemen who made this video happen!
You've given me a new way to think on how to move forward.. the answers can be so obvious sometimes. Dont know why I didnt see it. Thanks for doing the video👍
I've watched quite a few of your videos now and just wanted to say I'm enjoying them. They're hitting the nail right on the head for what I need right now. Cheers
Man, you are a moster brain!
So good description!
I had same situation as you described about relationships with the girl, at some point, it was hard for me to quit, because of invested time and money, but in the end of the day - this does not matter at all! The girl was feeling, that we must finish our relationship, and when it comes to that point - better to forget previous "investments", and focus on future possibities, evaluate your situation and quit right away, without making love to die out painfully slowly anyway.
Better to finish it right away and go further in life, while the girl is still young.
Oohhh. I am so blessed that I found this channel. I learned a lot. I need this. Thank you so much Sir! 🤜🏻
love the insight provided by this channel. not found elsewhere on youtube
I've always felt guilty of giving up on something which doesn't make me feel good anymore. Thankfully, today I watched this video and everything will be different from now on
The only issue I take with this is the movie analogy. Time is cheap, at least for me. Money is expensive (technically). Depending on the movie, if its dull, theres always a chance it could get better. It wouldn't be the first movie with a boring intro. If it's not the kind of thing i want to watch, IE dark themes or morally wrong, I would cut my losses and leave. I guess it comes down to context. Other than that, great video.
another great example is changing lanes while driving only to end up behind the slow car. How many times has that happened? every freaking day!!
I had that with a book: the first chapter was exciting, but chapter 2 - 5 weren’t that great: the main character annoyed me. After 2 years I gave the book another go and it turned out from then on the story grew to me. (Though it could be that while the story developed, the book focus shifted to an other character I could more easily identify with.)
You stated "Time is cheap, at least for me". Time is finite. Imagine time as a bucket of coins, but unlike a piggy bank you can only take money out, you can never put any back. When asked if Bill Gates was prompt his secretary replied "Even Bill Gate with all his wealth cannot buy another second on earth" . Money can be made-lost-made again...Lather-Rinse-Repeat, but time is finite. If something (or someone) is wasting your time cut that most expensive cost. Please, you owe it to yourself...Time is finite!
@@jackvisn so true. Time is not cheap, it is actually invaluable. And you realise that once you never get a chance to tell someone how much you loved them, or you can never do something you could again. 2h wasted in a movie that is clearly not what you expected (and I think the video talks about clear cut cases) is spot on analogy. The only problem is "hope" that gets in the way.
I think the example is supposed to be a film which is not the sort of film you would watch, I love films, but really dont like horror movies, so if I paid to go to the cinema and somehow accidentally went into a horror showing, then I would have lost the fee, 2 hours of my life, and scared myself shitless and probably triggered anxiety.
But, as other commenters point out, time is valuable, whether or not you have money, why spend time doing something you dont enjoy when you could be doing something you do enjoy, as it demonstrated in the narrators example at the end, he could keep playing a game to develop a character he has spent years building up, but not enjoy doing it that much, or, he could do something for fun and/or productive, like making youtube videos for us. I think he made the right choice.
Love your videos - well illustrated and narrated, neither too long nor short and always something new to learn that you can apply to your life
I am struggling severely with a similar but different issue. I have made mistakes in my recent past that I cannot let go of... They randomly pop into my head and haunt me rendering me useless until the feelings pass. In a way to need to cut my emotions from the events, realizing I cannot change them; it's done. But I don't know how to do this and God if I did my life could be so much simpler again.
When you gave the choice between Paris and Rome I thought to myself "I'm losing $3000 either way, might as well have the most fun I can in the process." Also, I'm 100% sure that this doesn't affect me. I can quit things at any moment. I played on this Minecraft server called Wynncraft until I had multiple very high level characters and then I just quit because I knew it was lost time and there's no point in wasting more time.
exactly the same. I also quit after my mage was level 60. Now i sometimes play and it actually feels fun if you do it ones a month
I dont think that time you enjoy spending is spent time
If you think you are safe from sunk cost fallacy you are most likely mistaken. It is present everywhere: Have you bought a food product, you found out isn't the best, but still ate it? Have you started watching a show/ youtube video and wanted to watch it to the end even if you knew you wouldn't gain much from it, did you go to a theater/ movie and stayed even though you didn't enjoy it? Just because you sometimes avoid sunk cost fallacy, doesn't mean you are safe from it.
I'm the same way. My past is full of games, jobs, and relationships that stopped bringing joy and satisfaction and when I realize it, I drop them and search for what I really want. I work as a cook now now and so far the open ended interactions I encounter daily keep me engaged. Here's hoping I never wake up one morning and find it's time to change my life again.
Watching this video on Independence Day in my country in the middle of making a major personal financial decision. It is no accident that I found your channel about 10 minutes or so again. Thanks for making this content. New sub
I was waiting for your video.
Thank you man!!
This channel has amazing topics and great explanations... i watch anything you put out ASAP. Thanks
I love your videos! I really enjoy the perspective you give us and the timing is perfect. Thank you!
Hi there !
Love your videos as the explanations are crystal clear and the examples are relatable.
They are very helpful !
Keep up the good work.
👍👍👍👍👍
Thank you. You are a severely underrated Channel and I hope that you swiftly gain all recognition that you deserve🤙
Great video, concise but fun. You always make sense and I am so thankful for your videos.
Relatable like in exam if u waste 5 mins on a que you haven't even learnt.doesnt mean wasting more time will make you answer it.
I come back later to those questions.
Amazing video. Your presentation and voiceovers is excellent that drives home the point.
I've known about this for some time now, but your video pushed me to make some actual decisions, thanks and keep up with the great content. Personally it lets me reflect on myself and set some goals for improvement.
This is one of the most helpful videos I have ever watched. I wished I had known about the sunk cost fallacy a long time ago.
I needed to hear this , thanks so much
This is a good one to watch and very relatable. Thank you!
Thanks. I have been thinking recently about this. And I found this video. Very helpful
Thank you this was exactly what i needed to hear❤
I love this topic. Thanks!
This video came out right on time for me. I've been looking at stopping some habits to create time for some healthier ones. I actually had this fallacy in my head since yesterday.
Best ever video I had watched regarding reform in our live regarding every aspect
Bro continue such type of videos👍👍👍
Thank you for the insight well put.
Just found your channel and I really like your vids, keep it up 👍👍👍
This is excellent, and widely applicable. Thank you!
I showed this to my wife and we are now getting a divorce!! Best video everrrrr. Subbed, liked, shared, added to playlist and favorited video.
Huge thanks to the people behind this channel.👏👏
It was a wonderful knowledge I gained from you today! Thank you :)
I haven't thought about it in that way. Now I know that I should think about my future when I take a decision. It sounds normal, doesn't it? But in the moment, we forget that. Thank you for this great video! 👋 🌟
This is by far my favorite video on this channel 😃
Love this! This relates to the principle of 'loss aversion' in behavioural economics, where marketers position their offering as avoiding a loss rather than achieving a gain because humans see more value in avoiding losses
Amazing! Especially it is explained very very well! Congratulation for your job and your decisions!!
I may object: what if the movie has a slow tempo in the first 15 minutes but then after some master plot twist it becomes a great film? Then you will lose twice. Therefore I prefer another example: after finishing the main dish in a restaurant you see in the menu a dessert that looks amazing. You pay for it, you get it, and once you have started eating it you realise it does not taste good. Then you are completely sure you are not missing a thing because you can judge on the total of the dessert. In the other hand, evaluating a movie from its 15 first minutes may be a wrong judgement.
I get where you are coming from. The sunk cost is a better judgment analysis if applied in economics such as the stock market. It is not recommended to consider sunk cost when facing complicated scenarios that involves different subjective (personal) factors. For example, it is better off if you part ways with your partner because of the unhealthy atmosphere which you might potentially endure for the last 40 years or so. We cannot just place the sunk cost in this scenario because the antithesis proposition of the sunk cost (40 years of unhealthy relationship) is also a fallacy called slippery slope - if added with context, it's a hasty generalization.
My point here is the same with you. We can't just use this sunk cost concept in our daily lives. Married couples who are at the brink of parting ways, if they chose to still stay, research says that they tend last with a changed happy atmosphere. Imagine if you really did part ways with this person, you just doubled your losses.
I'd never grasped this before. Thank you soooooooooooo much for helping me get it!!!!!!!!!!!!!!!!!!!!!!
Thank you for this video ❤️ your way of explanation is very effective 👍 I'm a lecturer and I use the methods you incorporated to explain in your content.
Great work Thank yoU
This My First Ever UA-cam Content Ur the best UA-camr really and your channel is very under rated comparing to the knowledge present in your content
This video helped me a lot. Thanks!
VERY WELL STATED...BUT VERY HARD TO DO👍"STRONG DISCIPLINE" NEEDED!
I LIKE THE CARTOONS TOO😆
Thanks a lot for another insightful video :) :)
I feel i am lucky to find this channel..... welling so much for the next vedio
Just in time, thanks!
The biggest lesson I learned from this video was that *Everyone had a Runescape era!*
Everyone 😂
Thanks for great explanation. The example of Ticket is taken from Thinking Fast and Slow. Very amazing book to read.
Love your videos, keep it up ~
I love your videos! I knew this one before but I think it's ironic that even if one is aware of it, sometimes or especially when you begin to change it, it's often quite hard to do so. I aready do it with books or movies which I don't like during reading/watching because I feel like the time finishing it isn't worth it, so I just quit doing it :)
great video as always mate.
Great timing as always! 😃
Extremely interesting, us usual. Thank you
Thank you for the valuable and rare knowledge
Thank you❤️
I had a problem with sunk cost fallacy in relationships. I feel that it’s worth salvaging and trying to fix a relationship even if the other person is abusive because I care about the other person and have invested time and resources into the other person. This has gone two ways extremely successful relationships and extremely difficult and unsuccessful relationships like a double edged sword. Over time though I think I have gotten better at judging another persons value and through experience have changed my mind about my own sunk cost fallacy, changing from a scarcity mindset in relationships or salvaging bad ones to a more unique abundant mindset ex. leaving a bad one in order to pursue a better more unique one. I think our minds invent sunk cost fallacies based off previous experiences and scarcity understanding. Once we have more of something or a more stable amount this sunk cost fallacy starts to unravel.
Thank you man! I’ve been seeing time as a more valuable asset thank money
Very clear ,thank you
Another helpful example is when starting a new, healthier diet.
Ppl feel obligated to finish what's in the house before starting.
Wow! What an eye-opener for me. I can't wait for an opportunity to put this into practice.
you nailed it man. it helps in thinking to take decisions objectively
This reality. most people sustain to resist to their position even if it bad to them looking how much effort they pay for it.
Good lessons than I am better than yesterday in this phenomena. Thank you
Very good video!!
I've quitted a music activity after many years and hopes, it has been very hard to do it. My advice is to understand as soon as possible if you have to quit. Do it before and it will be more easy. Don't waste your time, use it for something new
Wow. This made me think about a lot of things.
Damn this video came at a good time! Now I’m going to start thinking before I buy and the time I give to people💯
Thank you
Finally you uploaded a video
Your videos are much knowledge than other motivation channels videos... it's more than motivation. It's like knowing the reality as it is. I subscribed your channel from India♥️☺️