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Effects of cost and accuracy on the decision to request and to utilize expert advice were investigated in 2 experiments using a choice task. Experiments 1 and 2 found that experienced accuracy significantly predicted requesting expert advice. Participants in Experiment 2 used very inaccurate experts to rule out the expert's option. Cost affected requesting advice in Experiment 1 only when cost was able to exceed the amount that could be gained for a correct choice. Experiment 2 found a significant interaction between cost and experienced accuracy. Both experiments found requesting advice was the only significant predictor for changing answers. The results did not support an adherence to sunk costs in the decision to change answers.

會計學教課書都教學生：決策之作成，應從成本效益出發，至於過去已投入的成本屬沉沒成本，非攸關，不應影響決策，讀者少有質疑，但事實究竟如何？實務上，決策者做決策時，考量之因素甚多，不會只有成本一項，不過教課書多只著重成本一項，這又與事實相左。本研究以「核四決策」為例，探討實務上決策之作成，在諸多因素中沉沒成本是否真的沒攸關性。 核四應否停建，不論在能源、社會政策等層面皆具高度爭議性。本研究結合會計領域與重大公共政策議題，藉支持/反對停建核四之觀點，辨認決策者或旁觀者所在乎之因素，如已投入興建成本、完工程度、預期尚需投入成本、經濟結果，以及核能安全、核電廠可能面臨的風險等，再探討決策者對停建核四的態度是否受沉沒成本或其他因素之影響；以及，決策者的知識背景（會計系、政治系）及政治理念是否影響決策者的上述認知。 本研究透過問卷搜集資料，發現已投入之核四興建成本（即沉沒成本）顯著影響受測者贊成停建與否的態度：當受測者越覺得沉沒成本重要，越傾向反對停建核四，有沉沒成本效果存在。本研究也發現受測者最重視的細項決策因素，為「臺灣若發生類似福島核災之核災損失」。對臺灣而言，日本福島本具時間、地理、文化上的相近性，再加上媒體敘事的渲染力，福島核災創造人民對於核災的公共想像及恐懼。在其他因素中，「非核家園」之理念亦顯著影響核四決策：當受測者越覺得「非核家園」之理念重要，越傾向贊成停建核四。本研究還發現受測者的知識背景影響其對沉沒成本的態度：評估核四決策時，政治系受測者較會計系受測者，易受沉沒成本影響，將沉沒成本視為攸關。再者，政治理念對於受測者贊成停建與否的影響，當受測者對候選人的偏好為江宜樺先生等人，其立場以反對核四停建居多；當受測者對候選人的偏好為蔡英文女士等人，其立場以贊成核四停建居多。 本研究發現臺電的溝通效果不佳，除數據之可靠性待加強外，傳遞的資訊並未針對問題的核心，例如核能安全很受受測者重視，然而臺電於說明核電廠之安全時，使用「複合式災害」來描述福島核災，複合來自地震及海嘯，而事實上福島核災係因海嘯而造成，海嘯因地震而引發；臺灣外海斷層之地理構造使臺灣核電廠區域縱有大地震時，也不會遭遇如福島般的大海嘯。 因此本研究建議臺電和行政機關，應針對核能安全及核能政策，辨認人民容易產生誤解的資訊為何，以正確的用詞精確澄清。此外，非會計背景之決策者，應加強關於沉沒成本的認知；會計背景之決策者，應抱持批判性思考的態度，質疑「沉沒成本不應該影響決策」的理論是否事實上成立。 / There is an undoubted rule always on accounting textbooks, which is, decision making should base on the cost-benefit analysis, as for the investment in the past belongs to sunk cost and is irrelevant to the decision making. However, is this legit? There are so many concerns beyond the cost when decision maker making decision, but most textbooks only focus on the cost, which is different from the turth. This research takes “the decision making in Lungmen nuclear power plant” as a case study, to examine whether sunk cost is truly irrelevant to decision making in reality. The issue that whether construction of Lungmen nuclear power plant should be suspended is highly controversial, no matter in aspect of energy, social policy and so on. First, across accounting and public issues, the researcher collects the viewpoints from pros and cons toward this issue, and identifies decision factors, for examples, the invested construction cost (which means sunk cost here), the degree of project completion, future expected cost, economic results, and nuclear safety, probable risk of nuclear power plant. Second, this research examines whether sunk cost or other factors influence decision makers’ attitude toward the issue. Third, whether knowledge backgrounds (major in accounting or political science) and political ideologies of decision makers influence their cognitions about sunk cost and the issue. By questionnaire survey, the results of this research found: First, sunk cost does influence receivers’ attitude toward the issue: the more important receivers think sunk cost is, the more they against the construction to be suspended; sunk cost effect has been observed. Second, among factors, receivers take Japan’s Fukushima nuclear disaster most serious. We argue that Fukushima nuclear disaster’s timing, geography and Japan’s culture are close to Taiwan, thus the disaster deepen public imagination and fear about the nuclear disaster. Third, the idea of nuclear-free homeland also influences decision making in the issue: the more important receivers think the idea is, the more they support the construction to be suspended. Forth, receivers’ knowledge backgrounds influence their cognitions about sunk cost: compared with receivers major in accounting, receivers major in political science take sunk cost as a relevant factor. Fifth, political ideologies of receivers influence their attitude toward the issue: when receivers vote to Jiang Yi-Huah etc., most of them against the construction to be suspended; when receivers vote to Tsai Ing-Wen etc., most of them support the construction to be suspended. Sixth, Taiwan Power Company doesn’t have effective communication with the public. Not only reliability of its data, but the covey of core information should be improved. For example, it describes Fukushima nuclear disaster as a “compound disaster” including earthquake and tsunami, but actually the disaster happened only due to tsunami caused by earthquake. The geological formation of offshore faults of Taiwan is different to Japan, thus there will be no Fukushima-like tsunami in Taiwan. This research suggest: First, Taiwan Power Company and executive administration should identify the information that public easily misunderstood, especially about nuclear safety and energy policy, and then clarify with proper words. Second, decision makers with non-accounting background should improve their knowledge about sunk cost. Third, decision makers with accounting background should have critical thinking about whether the theory that “sunk cost is irrelevant to decision-making” is found in reality.

Dissertação (mestrado)—Universidade de Brasília, Programa Multiinstitucional e Inter-regional de Pós-Graduação em Ciências Contábeis, 2007. / Submitted by Natália Cristina Ramos dos Santos (nataliaguilera3@hotmail.com) on 2009-10-13T12:29:17Z No. of bitstreams: 1 Dissert_NaiaraTavaresDomingos.pdf: 398886 bytes, checksum: 205cabb1ec0f034b27935ccb855a05e8 (MD5) / Approved for entry into archive by Marília Freitas(marilia@bce.unb.br) on 2009-12-03T13:33:13Z (GMT) No. of bitstreams: 1 Dissert_NaiaraTavaresDomingos.pdf: 398886 bytes, checksum: 205cabb1ec0f034b27935ccb855a05e8 (MD5) / Made available in DSpace on 2009-12-03T13:33:13Z (GMT). No. of bitstreams: 1 Dissert_NaiaraTavaresDomingos.pdf: 398886 bytes, checksum: 205cabb1ec0f034b27935ccb855a05e8 (MD5) Previous issue date: 2007-10-23 / O fenômeno da insistência irracional é traduzido como um compromisso assumido pelo tomador de decisão em continuar investindo numa ação, mesmo diante de informações negativas. O objetivo da presente pesquisa foi verificar a ocorrência da insistência irracional quando informações sobre o montante de custos perdidos (efeito sunk cost) ou sobre o percentual de conclusão de um projeto (efeito do percentual de conclusão) eram apresentadas em um cenário empresarial ou pessoal. Foram avaliados três montantes de custos perdidos (um, cinco e nove milhões) e três percentuais de conclusão do projeto (10%, 50% e 90%), além das três versões neutras, isto num contexto empresarial. Pois, no contexto pessoal foram avaliados dois questionários, sendo um questionário neutro e outro contendo o montante de custo perdido. Para tanto, 1605 questionários foram aplicados em estudantes universitários de cinco cidades brasileiras no período que compreende o segundo semestre do ano de 2006 e o primeiro de 2007. Com relação ao efeito sunk cost, os testes realizados demonstraram que a informação do montante de recursos já investido é determinante na incidência do comportamento irracional da amostra estudada. E, também foram encontradas evidências estatísticas de que a informação do percentual de conclusão do projeto de 50% e 90% é determinante do comportamento da insistência irracional. Os testes realizados demonstraram que algumas variáveis analisadas exercem influência nos resultados alcançados, como exemplo, o gênero feminino demonstrou-se mais sensível à evidenciação do montante já investido. Os resultados apresentados nesta pesquisa demonstram que a irrelevância dos custos perdidos para uma decisão financeira é uma lição difícil de ser apreendida. ______________________________________________________________________________ ABSTRACT / The phenomenon of irrational insistence is translated as a commitment assumed by decision-maker to continue investing in a stock, even if having negative information. The aim of this research was to verify the occurrence of irrational insistence when information about the amount of sunk costs (sunk cost effect) or about the percentage of completion of a project (effect of percentage’s completion) were presented in a scenario business or personal. They were evaluated three amounts of sunk cost (one, five, and nine million) and three percentage of completion of the project (10%, 50%, and 90%), in addition to the three versions neutral, that in a business context. Thus, in the context personnel were evaluated two surveys, one neutral and another survey containing the amount of sunk cost. In this way, 1605 surveys were applied to students of five Brazilian cities in the period which includes the second half of the year 2006 and the first of 2007. Regarding the sunk cost effect, the tests showed that the information of the amount of resources already invested is crucial in the incidence of the irrational behavior of the sample studied. And, also were found statistical evidence that the information of the percentage of completion of the project by 50% and 90% is determining the behavior of irrational insistence. The tests showed that some variables analyzed exert influence on the results achieved, as an example, the female gender shown to be more sensitive to the disclosure of the amount already invested. The results presented in this research show that the irrelevance of the sunk costs to a financial decision is a difficult lesson to be seized.

This research examines escalation of commitment in capital investment decisions and the extent to which it can be mitigated using a cognitive prime. Specifically, I examine the use of a cognitive prime as a way to mitigate escalation in three decision-making settings: (1) individual, (2) face-to-face team, and (3) computer-mediated team. Continued investment in failing projects is costly for firms. The use of a cognitive prime to reduce escalation would provide a low cost way to mitigate escalation. In this study, participants are primed to think about sunk costs. The expectation is that priming individuals to think about sunk costs will increase the accessibility of sunk cost knowledge and reduce the likelihood of continued investment in the failing project. Further, based on Persuasive Arguments Theory, it is expected that the prime will reduce escalation in teams communicating in a computer-mediated setting more than in any other decision setting. The results of the experiment support the prediction that priming will reduce escalation and did so in all decision making settings. Further, the results indicate that, in the computer-mediated setting, primed teams had the least amount of escalation behavior coupled with the largest difference in escalation compared to teams that were not primed.

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The sunk-cost fallacy (SCF) occurs when an individual makes an investment with a low probability of a payoff because an earlier investment has already been made. It is considered an error because a rational decision should not factor in now-irretrievable investments, as they do not affect current outcome likelihoods. Previous research has measured the tendency to commit the SCF by using hypothetical scenarios in which participants must choose to make a future investment or not after making an initial investment. There are many theories as to why people commit the SCF. Loss aversion, which is the preference for uncertain over certain losses, may be related to the SCF. Dual-process theory, which views decision-making in terms of a fast, automatic process called system 1 and a slow, deliberate process called system 2, may also help to explain the SCF. In Experiment 1, participants were asked to complete a sunk-cost questionnaire in which the initial-investment types and amounts varied. They also completed an endowment-effect task as a measure of loss aversion. The SCF was committed most often when the initial investment was large compared to small and most often with money, less with time, and least with effort. There was an interaction effect in which small differences were seen in the SCF between time, effort, and money when the initial investment was small, and differences grew larger as the initial investment increased. Loss aversion displayed a non-significant negative relation with the SCF. In Experiment 2, participants completed a sunk-cost questionnaire in which they were asked to respond as they normally would and then from the perspective of a fictional person described as a logical decision maker. In cases in which they committed the SCF, they were asked to indicate why they continued to invest. They also completed a risky-lottery loss-aversion task. As seen in Experiment 1, the SCF was more likely when initial investments were greater and occurred most when the initial investment was money, less when it was time, and least when it was effort. Loss aversion had a significant but small negative relation with SCF scores. There was no effect of perspective taking. It may be that the SCF is simply due to the over-application of the personal rule “don't waste”, as not wanting to be wasteful was the most-common reason participants gave for why they committed the SCF.

This dissertation consists of three essays pertaining to the causes of the levels and composition of the international trade flows of nations, and the consequential implications for the levels of per capita income and welfare of their populations. The first of these documents a pattern of comparative advantage in product level, bilateral trade data that conventional quantitative trade models have difficulty explaining. It goes on to develop a theory of product level productivity differences based on endogenous differences in the allocation of research and development into product and process innovation across countries over time, and it shows that, when fitted to cross-country manufacturing wage data, the predicted product level technology distribution is consistent with the observed trade pattern. The second essay shows that the distribution of technology levels inferred in the first essay can help explain the inability of both ad-hoc and theoretically based gravity models of trade to account for the observed positive correlation between the percentage of manufacturing output that is traded and countries' per capita income. It derives a modified gravity equation based on a Ricardian model of trade with deterministic product level technology differences across countries. It then uses estimates from a product level gravity estimation to compute the component of this equation that differs from a conventional gravity equation in order to determine the extent to which the observed concentration of comparative advantage in a common set of products for low-income countries explains the small percentage of their output that is exported. The final essay shows that a simple model of firm profit maximization in the presence of sunk costs of entering the export market is broadly consistent with the observed persistence of exporting behavior in firm level data. It uses this simple model and moments from data on US manufacturing firms to estimate the value of the sunk export entry costs faced by these firms using an indirect inference strategy. These costs are shown to be substantial relative the revenue stream of a typical firm. / text