A NIGHT OF POETRY AND SUNK COST DILEMMA

A NIGHT OF POETRY AND SUNK COST DILEMMA

A friend rang me three months ago to tell me that a Hindi Poetry Evening had been organized in his town hall. The entrance tickets was £15 per person. I bought two tickets, for me and my wife.

On the morning of the show I came to know that Mr. Sondhi, the main poet cum entertainer, in whom I was really interested, was not coming. The weather should have become warmer by the end of April but it was still bitterly cold and wet, thanks to a swathe of freezing air from the North Pole.

Normally we would have taken the tram to go to the town hall because parking around there is scarce and expensive. But in this weather I did not relish the walk on either end of the tram journey.

 “What is the point in going if we would be wet and cold by the time we reach there, and particularly if Mr. Sondhi and his team were not attending” Bibha said. As you know she is my other half.

I said “but we have already paid. Why to waste the tickets? We should take the car. If we go an hour earlier, we could find a parking place”. The idea of losing £30 pounds which I had forked out on the tickets was not very palatable and it would keep niggling me for a few days at least.

My better half prevailed in the end and we cancelled the program. We enjoyed the evening at home in front of the fire with home cooked food and Pinot Noire.

I am constantly amazed and pleased (sometimes irritated) on how Bibha makes intuitive decisions which produce better outcomes.

My thinking was a typical example of what is called 'Sunk Cost Dilemma'. I was prepared to incur further cost in terms of parking fee and waste more time in order to justify the money already spent on the tickets. When one spend money and time on a project, one gets emotionally attached to it usually in direct proportion to the money and the effort invested. Even when it becomes clear that the project is not going to achieve its goal, people and organizations keep on investing more money and time.

The concept of sunk cost is well known and researched subject in business circles. In our day to day life it is equally important.

It explains, why many of us perpetually keep expensive but unfitting dresses in our wardrobes, carry on watching an excruciatingly boring movie and finish a bad tasting meal in a high-priced restaurant.

But hey, who wants to run his/her life like a corporate business!