Comparison
Sunk Cost vs Escalation of Commitment
Main difference in one sentence
Sunk cost is staying because of what was already spent, while escalation of commitment is adding even more to defend the bad choice.
Decision Traps
Decision-Making Traps
Sunk cost keeps a weak plan alive because past money, time, or effort feels too painful to waste.
Decision Traps
Decision-Making Traps
Escalation of commitment goes one step farther. People add more money, energy, or public defense because backing down feels like defeat.
Example where people confuse them
A team keeps an old project running because it already cost a lot. Then they approve another budget round to prove the project can still work. The first move is sunk cost. The second move is escalation.
Quick memory trick
Sunk cost says, “We already paid.” Escalation says, “Pay even more so we do not have to admit it.”