This research examines preinvestment forecasting processes in escalation of commitment, considering two questions: whether individuals are able to accurately predict their behavior and affect in escalation situations and how forecasting processes may be linked to actual escalation. Three experiments demonstrated that individuals underpredicted their escalation and overpredicted their postescalation regret. Two of the experiments also indicated that the less individuals predicted being entrapped, the more they escalated. Counter to expectations, anticipated regret did not predict escalation. The discussion focuses on the theoretical and practical importance of forecasting on escalation and on the importance of understanding both behavioral and affective forecasting effects simultaneously.
Alicke, M.D. (1985). Global self-evaluation as determined by the desirability and controllability of trait adjectives. Journal of Personality and Social Psychology, 49, 1621-1630.
2.
Allison, S.T., Messick, D.M., & Goethals, G.R. (1989). On being better but not smarter than others: The Muhammad Ali effect. Social Cognition , 7, 275-295.
3.
Arkes, H.R., & Blumer, C. (1985). The psychology of sunk costs. Organizational Behavior and Human Decision Processes, 35, 124-140.
4.
Bazerman, M.H., Beekun, R.I., & Schoorman, F.D. (1982). Performance evaluation in a dynamic context: The impact of prior commitment to the ratee. Journal of Applied Psychology, 67, 873-876.
5.
Bazerman, M.H., Guiliano, T., & Appelman, A. (1984). Escalation of commitment in individual and group decision making. Organizational Behavior and Human Decision Processes, 33, 141-152.
6.
Bobocel, D.R., & Meyer, J.P. (1994). Escalating commitment to a failing course of action: Separating the roles of choice and justification. Journal of Applied Psychology, 79, 360-363.
7.
Brockner, J., & Rubin, J.Z. (1985). Entrapment in escalating conflicts: A social psychological analysis. New York: Springer-Verlag .
8.
Buehler, R., Griffin, D.W., & Ross, M. (1994). Exploring the "planning fallacy": Why people underestimate their task completion times. Journal of Personality and Social Psychology, 67, 366-381.
9.
Buehler, R., & McFarland, C. (2001). Intensity bias in affective forecasting: The role of temporal focus. Personality and Social Psychology Bulletin , 27, 1480-1493.
10.
Conlon, E.J., & Parks, J.M. (1987). Information requests in the context of escalation . Journal of Applied Psychology, 72, 344-350.
11.
Diekmann, K.A., Tenbrunsel, A.E., & Galinsky, A. (2003). From self-prediction to self-defeat: Behavioral forecasting, self-fulfilling prophecies, and the effect of competitive expectations . Journal of Personality and Social Psychology, 85, 672-683.
12.
Epley, N., & Dunning, D. (2000). Feeling "Holier than thou": Are self-serving assessments produced by errors in self- or social prediction? Journal of Personality and Social Psychology, 79, 861-875.
13.
Epley, N., & Dunning, D. (2006). The mixed blessings of self-knowledge in behavioral prediction: Enhanced discrimination but exacerbated bias. Personality and Social Psychology Bulletin, 32, 641-655.
14.
Festinger, L. (1957). A theory of cognitive dissonance. Stanford, CA: Stanford University Press.
15.
Gilbert, D.T., Pinel, E.C., Wilson, T.D., Blumberg, S.J., & Wheatley, T.P. (1998). Immune neglect: A source of durability bias in affective forecasting. Journal of Personality and Social Psychology, 75, 617-638.
16.
Gilbert, D.T., & Wilson, T.D. (2000). Miswanting: Some problems in the forecasting of future affective states. In J. P. Forgas (Ed.), Feeling and thinking: The role of affect in social cognition (pp. 178-197). Cambridge, UK: Cambridge University Press.
17.
Griffin, D.W., Dunning, D., & Ross, L. (1990). The role of construal processes in overconfident predictions about the self and others. Journal of Personality and Social Psychology, 59, 1128-1139.
18.
Johnson, M.K., & Sherman, S.J. (1990). Constructing and reconstructing the past and the future in the present. In E. T. Higgins & R. M. Sorrentino (Eds.), Handbook of motivation and cognition: Foundations of social behavior (Vol. 2, pp. 482-526). New York: Guilford.
19.
Kahneman, D., & Snell, J.S. (1992). Predicting a changing taste: Do people know what they will like? Journal of Behavioral Decision Making, 5, 187-200.
20.
Ku, G. (2008). Learning to de-escalate: The effects of regret in escalation of commitment. Organizational Behavior and Human Decision Processes, 105, 221-232.
21.
Ku, G., Galinsky, A., & Murnighan, J.K. (2006). Starting low but ending high: A reversal of the anchoring effect in auctions. Journal of Personality and Social Psychology, 90, 975-986.
22.
Ku, G., Malhotra, D., & Murnighan, J.K. (2005). Towards a competitive arousal model of decision-making: A study of "auction fever" in live and Internet auctions. Organizational Behavior and Human Decision Processes , 96, 89-103.
23.
Larrick, R.P., & Boles, T.L. (1995). Avoiding regret in decisions with feedback: A negotiation example. Organizational Behavior and Human Decision Processes, 63, 87-97.
Loewenstein, G., & Schkade, D. (1999). Wouldn't it be nice? Predicting future feelings . In D. Kahneman, E. Diener, & N. Schwarz (Eds.), Well-being: The foundations of hedonic psychology (pp. 85-105). New York: Russell Sage Foundation.
26.
Morewedge, C.K., Gilbert, D.T., & Wilson, T.D. (2005). The least likely of times: How remembering the past biases forecasts of the future. Psychological Science , 16, 626-630.
27.
Murnighan, J.K. (2002). A very extreme case of the dollar auction. Journal of Management Education, 26, 56-69.
28.
Neale, M.A., & Bazerman, M.H. (1985). The effects of framing and negotiator overconfidence on bargaining behaviors and outcomes. Academy of Management Journal, 28, 34-49.
29.
Newby-Clark, I.R., Ross, M., Buehler, R., Koehler, D.J., & Griffin, D.W. (2000). People focus on optimistic scenarios and disregard pessimistic scenarios while predicting task completion times. Journal of Experimental Psychology: Applied, 6, 171-182.
30.
Perloff, L.S., & Fetzer, B.K. (1986). Self-other judgments and perceived vulnerability to victimization. Journal of Personality and Social Psychology , 50, 502-510.
31.
Roese, N.J. (1994). The functional basis of counterfactual thinking . Journal of Personality and Social Psychology, 66, 805-818.
32.
Rosenthal, R., & Rosnow, R.L. (1991). Essentials of behavioral research: Methods and data analysis (2nd ed.). New York: McGraw-Hill.
Ross, J., & Staw, B.M. (1993). Organizational escalation and exit: Lessons from the Shoreham Nuclear Power Plant. Academy of Management Journal , 36, 701-732.
35.
Royer, I., & Ku, G. (2007). Exit champions: De-escalating commitments in failing projects. Unpublished manuscript.
36.
Rubin, J.Z., & Brockner, J. (1975). Factors affecting entrapment in waiting situations: The Rosencrantz and Guildenstern effect. Journal of Personality and Social Psychology, 31, 1054-1063.
37.
Schoorman, F.D. (1988). Escalation bias in performance appraisals: An unintended consequence of supervisor participation in hiring decisions. Journal of Applied Psychology, 73, 58-62.
38.
Shubik, M. (1971). The dollar auction game: A paradox in noncooperative behavior and escalation. Journal of Conflict Resolution, 15, 109-111.
39.
Sieck, W.R., & Arkes, H.R. (2005). The recalcitrance of overconfidence and its contribution to decision aid neglect. Journal of Behavioral Decision Making , 18, 29-53.
40.
Staw, B.M. (1976). Knee-deep in the big muddy: A study of escalating commitment to a chosen course of action. Organizational Behavior and Human Performance, 16, 27-44.
41.
Staw, B.M. (1981). The escalation of commitment to a course of action . Academy of Management Review, 6, 577-587.
42.
Staw, B.M., & Fox, F.V. (1977). Escalation: Some determinants of commitment to a personally chosen course of action. Human Relations, 30, 431-450.
43.
Staw, B.M., & Hoang, H. (1995). Sunk costs in the NBA: Why draft order affects playing time and survival in professional basketball. Administrative Science Quarterly, 40, 474-494.
44.
Staw, B.M., & Ross, J. (1978). Commitment to a policy decision: A multi-theoretical perspective. Administrative Science Quarterly, 23, 40-64.
45.
Staw, B.M., & Ross, J. (1987). Behavior in escalation situations: Antecedents, prototypes, and solutions. Research in Organizational Behavior , 9, 39-78.
46.
Stotz, O., & von Nitzsch, R. (2005). The perception of control and the level of overconfidence: Evidence from analyst earnings estimates and price targets. Journal of Behavioral Finance, 6, 121-128.
47.
Teger, A.I. (1980). Too much invested to quit. New York: Pergamon.
Valley, K., & Medvec, V.H. (1998). Adam Baxter Company/Local 190 negotiation (Cases No. 9-396-318, 9-396-319, 9-396-321, 9-396-322, 9-396-324, 9-396-325). Boston: Harvard Business School Publishing.
50.
Vallone, R.P., Griffin, D.W., Lin, S., & Ross, L. (1990). Overconfident prediction of future actions and outcomes by self and others. Journal of Personality and Social Psychology, 58, 582-592.
51.
Walster, E., & Festinger, L. (1962). The effectiveness of "overheard" persuasive communications . Journal of Abnormal and Social Psychology, 65, 395-402.
52.
Weinstein, N.D., & Lachendro, E. (1982). Egocentrism as a source of unrealistic optimism . Personality and Social Psychology Bulletin, 8, 195-200.
53.
Wilson, T.D., & Gilbert, D.T. (2003). Affective forecasting. In M. P. Zanna (Ed.), Advances in experimental social psychology (Vol. 35, pp. 345-411). New York: Elsevier.
54.
Wilson, T.D., & Gilbert, D.T. (2005). Affective forecasting: Knowing what to want. Current Directions in Psychological Science, 14, 131-134.
55.
Wilson, T.D., Wheatley, T.P., Meyers, J.M., Gilbert, D.T., & Axsom, D. (2000). Focalism: A source of durability bias in affective forecasting. Journal of Personality and Social Psychology , 78, 821-836.
56.
Wong, K.F.E., & Kwong, J.Y.Y. (2007). The role of anticipated regret in escalation of commitment. Journal of Applied Psychology, 92, 545-554.
57.
Woodzicka, J.A., & LaFrance, M. (2001). Real versus imagined gender harassment. Journal of Social Issues, 57, 15-30.
58.
Zeelenberg, M. (1999). The use of crying over spilled milk: A note on the rationality and functionality of regret. Philosophical Psychology, 12, 325-340.
59.
Zeelenberg, M., & Beattie, J. (1997). Consequences of regret aversion: 2. Additional evidence for effects of feedback on decision making. Organizational Behavior and Human Decision Processes, 72, 63-78.
