Hal Arkes
Hal R. Arkes ran the first systematic experimental programme on sunk costs, with Catherine Blumer in 1985: ten experiments plus a field study on season tickets, all asking why people carry on with something purely because of what it has already cost them. He stayed on the question for the next forty years. The construct itself is not his. It is Richard Thaler's, named in 1980, and Arkes and Blumer's own first experiment is footnoted as adapted from him.
Who they are
Arkes is a psychologist working on judgment and decision-making. His conclusion about sunk costs is that the motive is moral rather than economic. People are not running a bad calculation, they are obeying a rule against appearing wasteful. That explanation, waste aversion, is genuinely his, and it is a different account from the economic one usually attached to the effect.
Catherine Blumer is his co-author on the 1985 paper and is named here because she usually is not. The house line on credit is to name Thaler for the construct and Arkes and Blumer for the experimental programme, in that order. Being the first to test something systematically is a real and separate achievement from being the first to name it.
Key papers
Arkes, H. R., & Blumer, C. (1985). "The Psychology of Sunk Cost", Organizational Behavior and Human Decision Processes, 35(1), 124 to 140. First author. Ten experiments and a season-ticket field study. Full text read in the vault, 2026-09-02.
Arkes, H. R., & Ayton, P. (1999). "The sunk cost and Concorde effects: are humans less rational than lower animals?", Psychological Bulletin, 125(5), 591 to 600. First author. A review of whether animals and young children show the same behaviour. Abstract only.
Thaler, R. (1980). The paper that names the construct. Not Arkes's, and credited first.
Key ideas
His explanation is moral, not economic. People are following a rule that says do not be wasteful, and that rule keeps working after the point at which it stops paying.
The animal review cuts against the simple story. If sunk-cost behaviour were a deep, basic feature of anything that invests effort, animals and small children should show it. Arkes and Ayton reviewed the evidence and concluded that they largely do not. That points towards a learned social rule rather than an ancient instinct, and it is awkward for the tidy evolutionary version of the idea.
Both sides on whether training helps. Arkes and Blumer's Experiment 10 found that economics training made no difference at all, including among students handed the questionnaire by their own economics professor after sunk cost had been covered in the lectures and in the textbook. Daniel Kahneman reports the opposite tendency, that graduate students in economics and business walk away more readily. Both are on the record here and neither settles the other. Our reading is that knowing the rule and applying it to your own Tuesday evening are separate skills.
Escalation of commitment is the neighbouring literature, about organisations rather than individuals, and the two are routinely merged when they should not be.
Concepts on this site
Sources
- Arkes, H. R., & Blumer, C. (1985). Organizational Behavior and Human Decision Processes, 35(1), 124 to 140. Full text read 2026-09-02.
- Arkes, H. R., & Ayton, P. (1999). Psychological Bulletin, 125(5), 591 to 600. Abstract only.
- Thaler, R. (1980). The originating construct.
- Vault note, 2026-09-11.