Escalation: A Closer Look at Allocation Decisions

The escalation of commitment to a particular course of action has, in the past eleven years, become an increasingly popular area for research in the psychological aspects of decision making. The major question posed by this line of research is: Does an individual become so committed to a particular course of action that he/she can no longer analyze the situation objectively and, consequently, makes irrational decisions to continue investing when such activity is no longer advisable? Staw (1981) states that the escalation phenomenon can occur when an individual becomes overly committed to a chosen course of action. He adds that the underlying assumption of this line of research is that individuals may go beyond the passive distortion of adverse consequences in an effort to rationalize a behavioral error (p. 579). In other words, if an individual is committed to a particular course of action, then he/she may commit a greater amount of resources, following negative feedback, in order to turn the situation around and in an attempt to eventually appear competent