The Effects of Feedback Equivocality on Escalation of Commitment: An Empirical Investigation of Decision Dilemma Theory1

The effects of feedback equivocality on escalation of commitment were examined in a laboratory study. Subjects had multiple opportunities to allocate money to market a software product. During the initial phase, subjects received feedback that was of either low or high equivocality. Half of the subjects in each equivocality level were given a standard by which to judge the feedback. In the second phase, all subjects received negative feedback. Consistent with Bowen's (1987) decision dilemma theory, subjects who received low equivocality feedback did not escalate allocations, and subjects who received high equivocal feedback escalated allocations. The presence of a standard or goal attenuated escalation. These results are consonant with a dynamic, temporally based account of escalation and are discussed in a synthesis of the literatures in behavior analysis, economics, forecasting, and psychology.     

Escalation of Commitment and the Framing Effect: An Empirical Investigation

Research and theory are reviewed which consider two decision biases: escalation of commitment and decision framing. Some authors (Bazerman, 1986; Whyte, 1986) have suggested that escalation of commitment may be explained by the decision framing used in the research paradigms. A study was conducted which simultaneously manipulated both responsibility for a prior decision and decision frame. Results show a main effect on resource allocation for responsibility and no effect for decision frame. A follow-up study found that amount of information provided systematically affected the framing bias, and that when responsibility was added to a large amount of contextual information, the framing effect became nonsignificant. These results suggest a need to further examine the boundary conditions of framing.     

Biased information processing in the escalation paradigm: information search and information evaluation as potential mediators of escalating commitment

Escalation of commitment denotes decision makers' increased reinvestment of resources in a losing course of action. Despite the relevance of this topic, little is known about how information is processed in escalation situations, that is, whether decision makers who receive negative outcome feedback on their initial decision search for and/or process information biasedly and whether these biases contribute to escalating commitment. Contrary to a widely cited study by E. J. Conlon and J. M. Parks (1987), in 3 experiments, the authors found that biases do not occur on the level of information search. Neither in a direct replication and extension of the original study with largely increased test power (Experiment 1) nor under methodologically improved conditions (Experiments 2 and 3) did decision makers responsible for failure differ from nonresponsible decision makers with regards to information search, and no selective search for information supporting the initial decision or voting for further reinvestment was observed. However, Experiments 3 and 4 show that the evaluation of the previously sought information is biased among participants who were responsible for initiating the course of action. Mediation analyses show that this evaluation bias in favor of reinvestment partially mediated the responsibility effect on escalation of commitment.     

De‐escalation after repeated negative feedback: emergent expectations of failure

Research on willingness to make marginal investments (e.g., the escalation and sunk cost literatures) has often focused on project completion decisions, such as the “radar‐blank plane.” This paper discusses a fundamentally different type of marginal investment decision, that of couples deciding whether to continue infertility treatment in the face of repeated failures. Two experiments based on this context show that when people face multiple independent chances to achieve a valued goal but are unsure about chances of success, premature quitting or “de‐escalation” is the norm. Repeated negative feedback appears to induce individuals to see each successive failure as more and more diagnostic. As a result, even a short series of failed attempts evokes beliefs that future attempts will also fail. These emergent expectations of failure, generated by causal attribution processes, associative learning, and/or discounting of ambiguous information, appear very compelling and induce people to forgo profitable marginal investments. Copyright © 2004 John Wiley & Sons, Ltd.     

The Influence of Compensation Method and Disclosure Level on Information Search Strategy and Escalation of Commitment

In this study we examined the extent to which compensation method and public disclosure influenced information search strategy and escalation of commitment. A laboratory experiment involving 182 student subjects employed a 3 (compensation: no-pay, salary, and contingent) by 2 (disclosure level: public and private) fully randomized, crossed design. Results show that in light of negative feedback concerning performance results of an investment portfolio, subjects whose initial allocation decisions were announced publicly reduced their search for prospective information, increased the search for retrospective information, and exhibited greater escalation of commitment than subjects who did not announce their initial investment strategy. The search for retrospective information and escalation of commitment was monotonically higher across the no-pay, salary, and contingent pay conditions respectively, while the search for prospective information decreased correspondingly. This study provides evidence that escalation of commitment is positively related to the search for retrospective information and negatively related to the search for prospective information. The results obtained from this experiment complement and extend prior work in the areas of accountability, cognitive dissonance and escalation of commitment. © 1997 by John Wiley & Sons, Ltd.     

Prospect Theory Predictions When Escalation Is Not the Only Chance to Recover Sunk Costs

Two experiments tested the effect of risk of alternative investment opportunities on decision behavior in an escalation context. In the first experiment (n = 170), the risk of the reinvestment option, which had been unsuccessful and incurred a sunk cost, was held equal to that of an alternative investment project. Responsibility for the previous decision was manipulated between these subjects. Subjects were required to choose between the reinvestment option and the alternative. Responsible subjects demonstrated classic reinvestment (escalation) tendencies, and nonresponsible subjects exhibited a significant tendency to avoid reinvestment. Subjects in the second experiment (n = 195) completed the same decision task and were also assigned to high and low responsibility conditions. In this experiment the risk of investing further in a previously chosen project, relative to the risk of the alternative project, was manipulated. Those subjects who were responsible for the first decision (a) demonstrated no preference for or against continued pursuit of the initial project (i.e., there was no escalation tendency) and (b) preferred the less risky of the second investments, regardless of whether it was or was not the initially chosen project. Nonresponsible subjects showed no risk preference or proclivity for reinvestment. The results of these experiments suggest that salient information concerning relative risk dominates the effect of prior performance information when alternative investments are considered. We discuss the implications of these findings for decision theory and for methodology in commitment escalation research.     

Comparison of Allocations by Individuals and Interacting Groups in an Escalation of Commitment Situation1

In this study, individuals and interacting 3‐person groups were asked to make a series of allocation decisions using a modified version of the A&S decision case (Staw, 1976). Based on the choice‐shift effect, it was hypothesized that groups would allocate more to a failing course of action than would individuals, and that these differences would emerge only after repeated sequential decisions. Both hypotheses were supported. These findings suggest that processes unique to groups account for the greater allocations of groups, relative to individuals in escalation situations. The implications of these findings in applied settings are discussed.     

The effects of strong belief structures on information-processing evaluations and choice

This study examined the influence of the strength of belief structures on selected aspects of the decision-making process. To examine these issues, a business-acquisition decision scenario was studied in an experiment. Subjects played the role of a CEO of an electronics firm and were asked to evaluate the attractiveness of six potential acquisition candidates and to rate various aspects of the associated decision process. We presented half the subjects with information that the belief structure of their organization was extreme, agreed upon, and clear. The other half was presented with information that there was disagreement about the belief structure and that it was more ambiguous and less extreme. The results clearly showed that the decision process is different for people who were presented with an agreed-upon, extreme, and tightly constructed belief structure when compared to those who received information reflecting a weak and loosely constructed belief structure. A strong belief structure resulted in less positive evaluations, information requested, and money allocated to explore incompatible acquisition candidates (and vice versa for a highly compatible candidate) when compared to subjects using a weak belief structure. In addition, subjects in the strong-belief condition reported that their decision process would be characterized by less doubt, less time, less difficulty, and less conflict compared to subjects in the weak-belief structure condition. Implications for both decision theory and practical decision processes are discussed.     

Behavioral Causality Orientations and Investment Decisions Following Negative Feedback

Individual differences in the locus of causality for behavior are seldom considered in tests of regulatory events (e. g., feedback and coercion). This study examined the relationship between Deci and Ryan's (1985a) causality orientation constructs and decision makers' behavioral intention responses to negative feedback following an initial decision. A laboratory experiment involved 98 Singaporean business students in a commitment escalation context in which sunk costs for an initial investment failure could be recovered by reinvesting in that prospect in preference to selecting an alternative that had previously performed better. Consistent with various theories of the escalation effect, in which subjects responsible for prior negative outcomes tend to reinvest in the initially chosen project, control orientation was positively associated with reinvestment and impersonal orientation was negatively related to reinvestment. The influence of personality on reinvestment/withdrawal behavior was moderated by the experimental condition of responsibility for the initial sunk cost. We discuss the implications of these findings for the construct validity of the causality orientations, the role of personality in commitment escalation, and the important role that individual differences in perceptions of regulatory events may play in determining behavior.     

Processing lexical ambiguity and visual word recognition in a deep orthography

We investigated the effect of semantic and phonemic ambiguity on lexical decision and naming performance in the deep Hebrew orthography. Experiment 1 revealed that lexical decisions for ambiguous consonant strings are faster than those for any of the high- or low-frequency voweled alternative meanings of the same strings. These results suggested that lexical decisions for phonemically and semantically ambiguous Hebrew consonant strings are based on the ambiguous orthographic information. However, a significant frequency effect for both ambiguous and unambiguous words suggested that if vowels are present, subjects do not ignore them completely while making lexical decisions. Experiment 2 revealed that naming low-frequency voweled alternatives of ambiguous strings took significantly longer than naming the high-frequency alternatives or the unvoweled strings without a significant difference between the latter two string types. Voweled and unvoweled unambiguous strings, however, were named equally fast. We propose that semantic and phonological disambiguation of unvoweled words in Hebrew is achieved in parallel to the lexical decision, but is not required by it. Naming Hebrew words usually requires a readout of phonemic information from the lexicon.     

愤怒和悲伤情绪对助人决策的影响:人际责任归因的作用

基于具体情绪理论——评价倾向框架理论(ATF),采用两项研究考察负性情绪愤怒和悲伤对助人决策的影响,并探究人际责任归因在这一关系中的作用。两项研究均采用自传体情绪记忆任务诱发情绪,研究一中自变量情绪为组间变量,包括愤怒、悲伤和中性三个水平,因变量助人决策操作为为他人花费时间;研究二中自变量1为组间变量情绪,包括愤怒和悲伤,自变量2为组内变量人际责任归因,操作为模糊归因、不可控的情景归因、可控的自我归因三种情境,因变量助人决策操作为为他人花费金钱。结果发现:(1)与愤怒情绪相比,悲伤情绪下个体为他人花费的时间和捐助的金钱更多;(2)在模糊的人际责任归因条件下,悲伤个体会比愤怒个体捐助更多的钱。研究表明:同为负性情绪的愤怒和悲伤在助人决策上的作用不同,悲伤个体比愤怒个体做出更多的助人决策;人际责任性归因会影响附带情绪和助人决策的关系。研究结论有助于理解附带情绪对助人决策的影响,进一步丰富并延伸ATF理论的证据和领域,对发挥情境中人际责任归因在助人决策中的作用具有一定的现实意义。     

Escalation in groups: Focus on information sampling

The purpose of this experiment was to examine if groups escalate more than individuals when information is not distributed to all group members. The experiment also attempted to replicate Bazerman, Beekun, and Schoorman's (1992) findings, that participants with high responsibility escalate more than participants with low responsibility. The task was a modified version of the Heeley Store Case (Bazerman et al., 1992). The dependent measures fell into three categories: rewards, appropriateness of layoff/demotion, and forecasted future performance. The results showed little support for the hypotheses. First, high responsibility participants escalated significantly more than low responsibility candidates for only one of the six measures. This may have been due to the fact that all participants felt responsible for their decisions. For the other dependent variables, the effect was either not significant or in the wrong direction. Second, no significant interaction was found between responsibility and decision-making context (individual, groups with all shared information, and groups with shared and unshared information). We then analyzed the data using a measure of felt responsibility as a covariate. The interaction between felt responsibility and decision-making context was significant only for layoff decision. For all of the other measures, no significant interaction was found. One possible reason why our hypotheses were not supported may have been that the groups felt a diffusion of responsibility. Larger groups may have also demonstrated the effects of group processes more effectively. No clear conclusions can be made regarding the influence of information sampling on escalation. An earlier version of this paper was presented at the 1998 meetings of the American Psychological Society.     

Escalation in groups: Focus on information sampling

The purpose of this experiment was to examine if groups escalate more than individuals when information is not distributed to all group members. The experiment also attempted to replicate Bazerman, Beekun, and Schoorman's (1992) findings, that participants with high responsibility escalate more than participants with low responsibility. The task was a modified version of the Heeley Store Case (Bazerman et al., 1992). The dependent measures fell into three categories: rewards, appropriateness of layoff/demotion, and forecasted future performance. The results showed little support for the hypotheses. First, high responsibility participants escalated significantly more than low responsibility candidates for only one of the six measures. This may have been due to the fact that all participants felt responsible for their decisions. For the other dependent variables, the effect was either not significant or in the wrong direction. Second, no significant interaction was found between responsibility and decision-making context (individual, groups with all shared information, and groups with shared and unshared information). We then analyzed the data using a measure of felt responsibility as a covariate. The interaction between felt responsibility and decision-making context was significant only for layoff decision. For all of the other measures, no significant interaction was found. One possible reason why our hypotheses were not supported may have been that the groups felt a diffusion of responsibility. Larger groups may have also demonstrated the effects of group processes more effectively. No clear conclusions can be made regarding the influence of information sampling on escalation. An earlier version of this paper was presented at the 1998 meetings of the American Psychological Society.     

认知闭合需要、框架效应与决策偏好

在带有模糊性的决策情境中,决策者个人的认知特征会对其判断决策产生重要影响。通过实验的方法,考察了认知闭合需要和特征框架效应对个体决策偏好的影响。93名工商管理硕士（MBA）参与了实验,研究的结果支持了本研究的3个假设,即认知闭合需要与特征框架效应不仅对被试的决策偏好存在显著的影响,而且二者还存在显著的交互作用。具体来说,研究发现,在模糊情境中：高认知闭合需要的被试偏好于立刻做出决策,而低认知闭合需要的被试偏好于暂缓做出决策;接收到正向框架信息的被试偏好于立刻做出决策,而接收到负向框架信息的被试偏好于暂缓做出决策;认知闭合需要与特征框架对被试的决策偏好还存在显著的交互作用。研究结论为根据个体认知闭合需要的水平来选拔决策者、利用框架效应来影响个体的信息加工方式进而提高决策质量提供了理论依据     

Relinquishment of control and the type A behavior pattern: the role of performance evaluation

We investigated the role of information processing in the control relinquishment decisions of Type As and Bs. Pairs of subjects worked independently on a task and received feedback indicating that their partner had performed at a comparable or superior level. On a second task, subjects combined their efforts and made decisions concerning who would work on different parts of that task. One third of the subjects made this decision before completing an evaluation of the initial performances. Another third completed the evaluation without knowing that they would subsequently make a control decision. The final third of the subjects completed their evaluations knowing that a control decision would follow. Results indicated that when the evaluations were completed last, or when the evaluations were completed first but without knowledge of the impending decision, Type As relinquished less control to a superior partner than did Type Bs. When the evaluations were completed with knowledge of an impending control decision, Type As and Bs did not differ in their decisions. These results suggest that under certain conditions, Type As use an automatic or mindless decision style with potentially maladaptive consequences.     

When success breeds failure: history,hysteresis, and delayed exit decisions

The effects of feedback equivocality, information availability, and prior decision-making history on escalation and persistence were investigated. Replicating the findings of J.L. Bragger, D.H. Bragger, D.A. Hantula, and J.P. Kirnan (1998), this study found that participants receiving equivocal feedback on their decisions invested more money and invested across more opportunities; those who could purchase information invested fewer resources than did participants who did not have the opportunity to purchase information. There was an inverse linear relationship between the percentage of opportunities in which participants purchased information and the delay to exit decisions and total resources invested. Six weeks earlier, some participants took part in a more profitable investment scenario, and prior experience led to later increased investing when participants were faced with failure, even above that invested in a preceding, succeeding scenario. These results are consistent with an equivocality theory account of escalation.     

The role of anticipated regret in escalation of commitment

This research tests the general proposition that people are motivated to reduce future regret under escalation situations. This is supported by the findings that (a) escalation of commitment is stronger when the possibility of future regret about withdrawal is high than when this possibility is low (Studies 1a and 1b) and (b) escalation of commitment increases as the net anticipated regret about withdrawal increases (Studies 2a and 2b). Furthermore, the regret effects in the 4 studies were above and beyond the personal responsibility effects on escalation. This research indicates that people in escalation situations are simultaneously influenced by the emotions they expect to experience in the future (e.g., anticipated regret) and by events that have happened in the past (e.g., responsibility for the initiating previous decision).     

Memory and frequency estimation processes in a decision task

Two experiments examined the role of information storage and frequency estimation processes in a simple decision task. On each trial from one to five simultaneous sequences of information were presented, and subjects were required to monitor and respond to each sequence. In one study independent groups of subjects gave decisions, recognition responses. or frequency judgments. In a second study recall responses were obtained from subjects as part of the decision and frequency judgment tasks. Changes in performance as the number of simultaneous sequences increased suggested an independence of decisions from memory for specific information. Performance on the decision and frequency judgment tasks exceeded at times that which was possible on the basis of specific information available. Other data suggested that subjects in the frequency estimation tasks maintained an accurate frequency count when possible, but in the decision task kept little more than a record of their currently favored hypothesis. When direct counting was prevented in the second experiment. performance in the two tasks was not significantly different, suggesting that the two processes are very similar under such conditions.     

Context and lexical access: implications of nonword interference for lexical ambiguity resolution

To eliminate potential "backward" priming effects, Glucksberg, Kreuz, and Rho (1986) introduced a variant of the cross-modal lexical priming task in which subjects made lexical decisions to nonword targets that were modeled on a word related to either the contextually biased or unbiased sense of an ambiguous word. Lexical decisions to nonwords were longer than controls only when the nonword was related to the contextually biased sense of the ambiguous word, leading Glucksberg et al. to conclude that context does constrain lexical access and that the multiple access pattern observed in previous studies was probably an artifact of backward priming. We did not find nonword interference when the nonword targets used by Glucksberg et al. were preceded by semantically related ambiguous or unambiguous word primes. However, we did replicate their sentence context results when the ambiguous words were removed from the sentences. We conclude that the interference obtained by Glucksberg et al. is due to postlexical judgements of the congruence of the sentence context and the target, not to context constraining lexical access.