Does survival threat make us irrational? The effects of disease cues on sunk cost bias

• Published date: 01 April 2024
• Author: Hao Sun,Rui Chen,Zhaoyang Guo
• Date: 01 April 2024
• DOI: http://doi.org/10.1111/joca.12567

RESEARCH ARTICLE

Does survival threat make us irrational? The

effects of disease cues on sunk cost bias

Hao Sun | Rui Chen | Zhaoyang Guo

School of Management, Xiamen

University, Xiamen, China

Correspondence

Zhaoyang Guo, School of Management,

Xiamen University, Location:

No. 422, Siming South Road, Xiamen,

Fujian 361005, China.

Email: zyguo@xmu.edu.cn

Funding information

National Natural Science Foundation of

China, Grant/Award Numbers: 71602168,

72072148

Abstract

Sunk cost bias is a pervasive issue in the real world, man-

ifesting in various domains, such as consumption and

investment, influencing consumer well-being. This bias

often leads to a misallocation of resources towards less

meaningful activities. In the current study, we explored a

novel factor, specifically disease cues, that influences the

sunk cost bias. Through a survey and four systematic

experiments, using both lab and natural manipulations of

disease cues, we demonstrate that disease cues encourage

individuals to overvalue their prior investments, leading

to an increased propensity for sunk cost bias in imagined

decision scenarios and real choices. We have also ruled

out alternative explanations for our findings. Signifi-

cantly,weaddedasurveytodirectlyexplorethesunk

cost bias and consumer subjective well-being, showing a

significant positive relationship between them. Our

research contributes to understanding consumer irratio-

nal behavior and aims to improve consumer well-being.

KEYWORDS

consumer well-being, disease cues, evolutionary psychology,

sunk cost bias

1|INTRODUCTION

Sunk costs represent investments that can never be recovered, so they should not influence

decision-making since decisions should be based on expected outcomes (Thaler, 1980). Sunk

Received: 6 June 2023 Revised: 28 November 2023 Accepted: 24 January 2024

DOI: 10.1111/joca.12567

© 2024 American Council on Consumer Interests.

342 J Consum Aff. 2024;58:342–363.

wileyonlinelibrary.com/journal/joca

cost bias is a pervasive phenomenon observed across diverse contexts in the real world. It refers

to many domains, such as consumption (Ho et al., 2018), investment (Garland, 1990), employ-

ment (Staw & Hoang, 1995), education (Coleman, 2010), and interpersonal decisions

(Malhotra & Gino, 2011). Sunk cost bias can lead consumers to make suboptimal choices, disre-

garding other opportunities and future outcomes, resulting in financial losses and reducing con-

sumer well-being (Emich & Pyone, 2018). For example, when individuals partake in a buffet,

they often continue to eat even when they are already full, disregarding it may harm their

health (Siniver et al., 2013). Similarly, despite investing in a project that has proven unsuccess-

ful, individuals often tend to persist in their investment, resulting in commitment escalation

and further wastage of resources (Arkes & Blumer, 1985; Schmidt & Calantone, 2002). Mean-

while, sunk costs cause individuals to experience negative emotions such as guilt, regret, and

wastefulness associated with abandoning substantial past investments, which can harm their

life satisfaction (Schanbacher et al., 2021). Individuals would have a sunk cost bias when they

want to avoid these negative emotions (Schanbacher et al., 2021).

In previous studies, researchers have identified several individual differences that can influ-

ence the sunk cost bias, including age (Strough et al., 2008; Strough et al., 2016), gender

(Bavolar, 2013), personality traits (Fujino et al., 2016; Misuraca et al., 2021; Rogge, 2021;Van

Putten et al., 2010), and emotional states (Emich & Pyone, 2018). While these insights are cru-

cial, they predominantly focus on internal factors that vary from one individual to another.

However, a critical aspect that has received less attention in the sunk cost bias literature is the

role of specific situational triggers, such as disease cues, in influencing sunk cost bias. Disease

cues represent a unique category of stimuli that can profoundly impact decision-making pro-

cesses (Galoni et al., 2020). This is particularly relevant in global health events, where wide-

spread disease cues can create a pervasive sense of uncertainty, influencing consumer behavior

(Park et al., 2021). In the face of health threats, individuals' perceptions and behaviors may

change significantly (Campbell et al., 2020), potentially altering their susceptibility to sunk cost

bias. Diseases play a pivotal role as a primary contributing factor to human mortality. Globally,

diseases account for a significantly higher number of deaths than other factors, such as acci-

dents or natural disasters. According to the World Health Organization (WHO), non-

communicable diseases (NCDs) are responsible for the mortality of approximately 41 million

individuals annually, representing about 74% of all deaths worldwide. Moreover, infectious dis-

eases also pose a substantial threat to human life. For instance, the COVID-19 pandemic alone

caused a minimum of 3 million deaths globally in 2020. Moreover, disease cues have been

found to influence various aspects of consumer decision-making and well-being (Ding &

Xu, 2023; Galoni et al., 2020; Huang & Sengupta, 2020; Whelan & Hingston, 2022). For exam-

ple, COVID-19 has led to consumers exhibiting more impulsive consumption (Chiu et al., 2022;

Islam et al., 2021). To the best of our knowledge, no prior research has examined the sunk cost

bias from the perspective of disease cues. In the current research, we aim to fill this gap by

investigating how an individual's exposure to disease cues influences their approach to sunk

costs.

Notably, previous studies have consistently shown that disease cues, such as those associ-

ated with COVID-19, lead to heightened health concerns and a significant degree of uncertainty

(Fiorillo & Gorwood, 2020; Li & Qian, 2022; Park et al., 2021). In line with these findings, it has

been observed that individuals often experience a diminished sense of control during perceived

threats (Jiao et al., 2022). Recent studies have found that uncertainty plays a pivotal role in the

emergence of the sunk cost bias because humans may use prior effort to infer future value in

response to uncertainty (Sweis et al., 2018; Watzek & Brosnan, 2020). Based on these findings,

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