Now Bob cannot just spend $300 to get a quality headphone. He would also waste Tim’s $100
That’s a form of sunk cost fallacy, a collective “we’ve sacrificed too much to stop now”.
Andy and Bob never touching it again because they have other books to work on
That doesn’t follow, the other books would’ve also been there without existence of this book’s poor translation. If the poor translation eats some market share, so that competing with it is less appealing, that could be a valid reason.
This is a tangent, but Sunk cost fallacy is not really a fallacy most of the time, because spending more resources beforehand really increases the chance of “success” most of the time. For more: https://gwern.net/sunk-cost
I am trying to pinpoint the concept of “A doing a mediocre job of X will force B to rationally do Y instead of X, making the progress of X worse than if A had not done anything”. The examples are just examples that hopefully helps you locate the thing I am handwaving at. I do not try to make them logically perfect because that would take too much time.
Anyways, the unwritten thing is that Bob care about having a quality headphone and a good pair of shoes equally. So given that he already has an alright headphone, he would get more utility by buying a good pairs of shoes instead. It is essentially a choice between (a) getting a $300 headphone and (b) getting a $100 headphone and a $300 pair of shoes. Of course there are some arguments about preference, utility != dollar amount or something along those lines. But (b) is the better option in my constructed example to show the point.
spending more resources beforehand really increases the chance of “success” most of the time
The decision to go on with the now-easier rest-of-the-plan can be correct, it’s not the case that all plans must always be abandoned on the grounds of “sunk cost fallacy”. The fallacy is when the prior spending didn’t actually secure the rest of the current plan as the best course of action going forward. Alternatives can emerge that are better than continuing and don’t make any use of the sunk resources.
It sure can! I think we are in agreement on sunk cost fallacy. I just don’t think it applies to example 1 because there exists alternatives that can keep the sunk resources. Btw this is why my example is on the order of $100, at this price point you probably have a couple alternative things to buy to spend the money.
I just don’t think it applies to example 1 because there exists alternatives that can keep the sunk resources.
What matters is if those alternatives are better (and can be executed on, rather than being counterfactual). It doesn’t matter why they are better. Being better because they made use of the sunk resources (and might’ve become cheaper as a result) is no different from being better for other reasons. The sunk cost fallacy is giving additional weight to the alternatives that specifically use sunk resources, instead of simply choosing based on which alternatives are now better.
Again, seems like we are in agreement lol. I agree with what you said and I meant that, but tried to compress it into one sentence and failed to communicate.
That’s a form of sunk cost fallacy, a collective “we’ve sacrificed too much to stop now”.
That doesn’t follow, the other books would’ve also been there without existence of this book’s poor translation. If the poor translation eats some market share, so that competing with it is less appealing, that could be a valid reason.
This is a tangent, but Sunk cost fallacy is not really a fallacy most of the time, because spending more resources beforehand really increases the chance of “success” most of the time. For more: https://gwern.net/sunk-cost
I am trying to pinpoint the concept of “A doing a mediocre job of X will force B to rationally do Y instead of X, making the progress of X worse than if A had not done anything”. The examples are just examples that hopefully helps you locate the thing I am handwaving at. I do not try to make them logically perfect because that would take too much time.
Anyways, the unwritten thing is that Bob care about having a quality headphone and a good pair of shoes equally. So given that he already has an alright headphone, he would get more utility by buying a good pairs of shoes instead. It is essentially a choice between (a) getting a $300 headphone and (b) getting a $100 headphone and a $300 pair of shoes. Of course there are some arguments about preference, utility != dollar amount or something along those lines. But (b) is the better option in my constructed example to show the point.
Let me know if I still need to explain example 2
The decision to go on with the now-easier rest-of-the-plan can be correct, it’s not the case that all plans must always be abandoned on the grounds of “sunk cost fallacy”. The fallacy is when the prior spending didn’t actually secure the rest of the current plan as the best course of action going forward. Alternatives can emerge that are better than continuing and don’t make any use of the sunk resources.
It sure can! I think we are in agreement on sunk cost fallacy. I just don’t think it applies to example 1 because there exists alternatives that can keep the sunk resources. Btw this is why my example is on the order of $100, at this price point you probably have a couple alternative things to buy to spend the money.
What matters is if those alternatives are better (and can be executed on, rather than being counterfactual). It doesn’t matter why they are better. Being better because they made use of the sunk resources (and might’ve become cheaper as a result) is no different from being better for other reasons. The sunk cost fallacy is giving additional weight to the alternatives that specifically use sunk resources, instead of simply choosing based on which alternatives are now better.
Again, seems like we are in agreement lol. I agree with what you said and I meant that, but tried to compress it into one sentence and failed to communicate.