Tuesday, January 10, 2023

The Sunk Cost Fallacy

You cannot know future events from past or present events; there is no way to prove that even a very likely event will actually occur.  Putting an immense level of effort into ensuring something comes about does not necessitate that the goal will be realized, yet some people might be reluctant to stop laboring towards even an unlikely outcome, as it is overwhelming for them to think of the possibility that all of the planning, money, emotion, or other kinds of resources they channeled into it would have been futile.  The fact that their labor would have been in vain is enough to frighten them away from thinking about the possibility or likelihood of futility, or they have assumed desperation can only be rewarded. This can be called the sunk cost fallacy, which is often brought up in a business context (it is relevant to literal financial investments), but which can be an error people succumb to in far more important contexts than mere business.

The fallacy, in all of its variations, strictly rests in believing that it is true that because so much has been poured into a process, it is logically necessary for it to lead to success, when this does not logically follow.  There is nothing logically invalid in avoiding assumptions but still remaining with a course of action out of an irrationalistic optimism or desperation.  It is making assumptions or ignoring evidence that something will not turn out as one wishes that is irrational.  A favorable or convenient outcome might or might not come about, and this is why it would be irrational to believe that any logically possible outcome must or must not occur.  However, simply choosing to put more resources or effort into achieving a goal after so much has already been poured into it is not inherently irrational, and thus pursuing this course of action is not necessarily motivated by fallacious notions.

For some reason, even though many people do things all the time with the hope that they are making certain favorable future events more probable, the sunk cost fallacy is often conflated with more than just an invalid epistemological belief or mistaken priorities.  Rationalistic awareness is consistent with taking risk or investing resources in an uncertain future, not that anything about the future is certain beyond that all necessary truths will of course remain intrinsically true.  Most people are fond of making selective assumptions about future events on the basis of emotional appeal, social norms, and subjective perceptions, so it is not as if they are rationalistic.  This is where the sunk cost fallacy's broader and more foundational applications actually lie: non-rationalists have put so much emotional "resources" into arbitrary, false, or unexamined/unverifiable worldviews that they would almost never give up their various forms of irrationalism due to their long-term familiarity with fallacies.

A significant part of why non-rationalists cling to errors, emotionalism, and assumptions, instead of necessary truths and their absolute certainty, is merely because so much of their lives has been spent in service to lies.  Like a businessperson who sees the futility or danger of a corporate plan but tries to carry it out anyway, non-rationalists pursue that which is irrational, with a key difference being that while the success or failure of many corporate plans is a matter of chance, as either outcome is logically possible, it is inherently impossible for rationalism to be false.  The casual stupidity and egoism of irrationalists is worse than any desperate business decision to persist against overwhelming odds.  In the more common case, a variation of the sunk cost fallacy is part of why rationalism is ignored or rejected by so many people.  It takes a kind of courage, humility, and selflessness to ever start holistically discovering that reason grounds truth and knowledge, with everything else being in some way metaphysically or epistemologically secondary.  Only a few are willing to take upon these qualities and give up an old life.

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