Monetary incentives can backfire while nonstandard interventions, such as framing, can be
effective in influencing behavior. I review the empirical evidence on these two sets of …

We outline a contextual and motivational model of judgment and decision‐making (JDM)
biases across the life span. Our model focuses on abilities and skills that correspond to …

The controversy over how much to charge for health products in the developing world rests,
in part, on whether higher prices can increase use, either by targeting distribution to high …

This article experimentally studies a two-stage elimination contest and compares its
performance with a one-stage contest. Contrary to the theory, the two-stage contest …

Although the effect of monetary sunk costs on decision-making is widely discussed, research
is still fragmented, and results are sometimes controversial. One reason for this incomplete …

In this article, we examine whether the option value of keeping an operation alive will deter
firms from exiting an industry. We find that uncertainty dissuades firms from exiting an …

We conduct an experimental analysis of a best-of-three Tullock contest. Intermediate prizes
lead to higher efforts, while increasing the role of luck (as opposed to effort) leads to lower …

That sunk costs are not relevant to rational decision making is often presented as one of the
basic principles of economics. When people are influenced by sunk costs in their decision …

Abstract In 1955, Herbert Simon introduced the notion of satisficing: an agent satisfices by
searching for an alternative that meets an aspiration level but does not optimize. We survey …

This paper reports on a laboratory experiment aiming at documenting the sunk-cost fallacy
in individual decision-making and at identifying the role of the cognitive ability in its …