Sunk Cost Fallacy

Completely random thing to think about at 1am. But was reading an article on the Sunk Cost Fallacy. Link at the end of this post.

Scenario 1: You are on your way to watch a movie which costs $10. On your way to the cinema, you lose $10 from your wallet. Would you still proceed to buy the tickets?

88% of people would.

Scenario 2: You have bought the tickets for $10. You lost the tickets. Would you repurchase the tickets to watch the movie?

Only 46% of people would. Most would not.

If you really think about it, the 2 situations are absolutely identical. But even as I know this, and go through the scenarios again and again, I still arrive at different conclusions for both.

It’s mindboggling. The theory is that in Scenario 2, we tend to think that we have “assigned the money to a specific purpose”. Something like we plonk it into different ledgers in our head (in accounting terms haha). Thus justifying to ourselves the different choices.

This is WEIRD. Why does my brain work this way?

Source: http://youarenotsosmart.com/2011/03/25/the-sunk-cost-fallacy/