Waste Aversion

Waste Aversion

Reviewed by Faisal Zaidi

Waste aversion is the rule against appearing wasteful, held as a moral norm rather than worked out as a calculation. It is a good rule in most of the places people learn it, and it goes wrong when it is applied to money, time or effort that is already gone and cannot be recovered by using it. On this account the Sunk Cost Fallacy is not a failure of arithmetic. It is a decent habit let loose in the wrong room.

What it is

Nobody will ever know whether you finished the series. There is no record, no reputation at stake, and no way to recover the ten hours. The pull to finish it anyway is the waste rule running on its own, with no audience and no benefit.

That is the claim in one sentence, and it is worth being clear about what kind of claim it is. It is not a claim about how people feel losses, which is the territory of Loss Aversion. It is a claim about a norm, a learned rule about how one ought to behave, which keeps operating in situations it was never meant for. The competing account, self-justification, says instead that people persist in order to defend a decision they made themselves, which is carried at Escalation of Commitment.