Further Investigations of Sunk Cost in Pigeons

The 2011 NFL collective bargaining agreement introduced significant changes to rookie compensation, including a rookie wage scale. We test if the new rules changed how sunk costs affect utilization for drafted rookies. Our regression discontinuity results show a robust sunk-cost fallacy that is similar in magnitude to the one documented under the previous agreement. Second-round selections play significantly less than their first-round counterparts, as measured by percentage of games started, total snaps played, and percentage of snaps played. However, the effect is not evident beyond the rookie season. Additional results show coaching success and coaching changes are important factors.

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The sunk cost effect in pigeons and people: A case of within-trials contrast?

Behavioural Processes ◽

10.1016/j.beproc.2014.09.035 ◽

2015 ◽

Vol 112 ◽

pp. 22-28 ◽

Cited By ~ 1

Author(s):

K. Geoffrey White ◽

Paula Magalhães

Keyword(s):

Sunk Cost ◽

Sunk Cost Effect ◽

Cost Effect

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EXPRESS: Effects of Payment on User Engagement in Online Courses

Journal of Marketing Research ◽

10.1177/00222437211016360 ◽

2021 ◽

pp. 002224372110163

Author(s):

Ali Goli ◽

Pradeep K. Chintagunta ◽

S. Sriram

Keyword(s):

Online Courses ◽

Massive Open Online Courses ◽

Full Potential ◽

User Engagement ◽

Sunk Cost ◽

Course Content ◽

Sunk Cost Effect ◽

To Receive ◽

Cost Effect

Massive Open Online Courses (MOOCs) have the potential to democratize education by improving access. Although retention and completion rates for non-paying users have not been promising, these statistics are much brighter for users who pay to receive a certificate upon completing the course. We investigate whether paying for the certificate option can increase engagement with course content. In particular, we consider two such effects: (a) the certificate effect, which is the boost in motivation to stay engaged in order to receive the certificate; and (b) the sunk-cost effect, which arises solely because the user paid for the course. We use data from over 70 courses offered on the Coursera platform and study the engagement of individual participants at different milestones within each course. The panel nature of the data enables us to include controls for intrinsic differences between non-paying and paying users in terms of their desire to stay engaged. We find evidence that the certificate and sunk-cost effects increase user engagement by approximately 8%-9%, and 17%-20%, respectively. However, whereas the sunk-cost effect is transient and lasts only for a few weeks after payment, the certificate effect lasts until the participant reaches the grade required to be eligible to receive the certificate. We discuss the implications of our findings for how platforms and content creators may want to design course milestones and schedule the payment of course fees. Given that greater engagement tends to improve learning outcomes, our study serves as an important first step in understanding the role of prices and payment in enabling MOOCs to realize their full potential.

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