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Living on the Edge: A Guide to Risky Behavior

A Risk Too Far: Behavioral Economics of Escalating Commitment to a Failing Course of Action

Friday, May 28, 2010, 11:15 AM - 11:40 AM
Back Bay Ballroom C

Donald A. Hantula

Donald A. Hantula
Temple University

Why do people persist in failing ventures despite repeated negative feedback? A dynamic escalation model based on data and theory from behavior analysis, economics of uncertainty and equivocality theory explores the perceived irrationality of escalation. Decision-makers facing failure are not necessarily making errors but are adapting to difficult decision dilemmas.

 
Subject Area: Living on the Edge: A Guide to Risky Behavior

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