paper-machine comments on Is Sunk Cost Fallacy a Fallacy? - Less Wrong

19 Post author: gwern 04 February 2012 04:33AM

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Comment author: Sniffnoy 05 February 2012 12:53:10AM 4 points [-]

And if it isn't, as I conclude (after an introduction discussing the difference between being valid in a simplified artificial model and the real world!), then it's perfectly legitimate to ask whether accusations of sunk cost fallacy - which are endemic and received wisdom - are themselves fallacious.

But none of this changes the fact that the title is still misleading. Even if accusations of sunk cost fallacy are themselves often fallacious, this doesn't change the fact that you are arguing that the sunk cost fallacy is a mode of reasoning which doesn't often occur, rather than one that is actually valid. Claiming that it is not serious may indeed be overturning a basic principle, but it is not the basic principle the title claims you may be overturning. Sensationalize if you like, but there's no need to be unclear.

Comment author: [deleted] 05 February 2012 02:25:31AM 1 point [-]

Even if accusations of sunk cost fallacy are themselves often fallacious, this doesn't change the fact that you are arguing that the sunk cost fallacy is a mode of reasoning which doesn't often occur, rather than one that is actually valid.

I don't know how you got that from the essay. To quote, with added emphasis:

We can and must do the same thing in economics. In simple models, sunk cost is clearly a valid fallacy to be avoided. But is the real world compliant enough to make the fallacy sound? Notice the assumptions we had to make: we wish away issues of risk (and risk aversion), long-delayed consequences, changes in options as a result of past investment, and so on.

Comment author: wedrifid 05 February 2012 06:05:18AM 1 point [-]

I don't know how you got that from the essay.

I believe Sniffnoy, like myself, gave the author the benefit of the doubt and assumed that he was not actually trying to argue against a fundamental principle of logic and decision theory but rather claiming that the principle applies to humans far less than often assumed. If this interpretation is not valid then it would suggest that the body of the post is outright false (and logically incoherent) rather than merely non-sequitur with respect to the title and implied conclusion.

Comment author: [deleted] 05 February 2012 06:23:58AM *  1 point [-]

Sniffnoy claims that gwern has argued "that the sunk cost fallacy is a mode of reasoning which doesn't often occur, rather than one that is valid."

Actually, what gwern has argued is that while the sunk cost fallacy is often used as an heuristic there is little evidence that it is sound to do so in real world situations. This also seems to be what you've said, but it is not what Sniffnoy has said.

Hence my confusion.

On a side note, I don't really understand your qualms with the title, but that's less important to me.

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