Question

• Give some examples of personal and interpersonal escalation dilemmas.  
• What are the psychological reasons for the escalation of commitment phenomenon?

Answer 1

Personal escalation dilemmas involves a single person taking a decision whether to continue with the action incurring losses for the individual or to cut down the loss causing action. For instance,

• Playing a gamble when you incur loss,
• Putting money in an old car causing lots of problems
• Putting money in the renovation of an old house which is deteriorating

Interpersonal escalation dilemmas include two or more people often in a competitive rivalry with each other. They fall into such trap as in the beginning they can't assume the loss incurred at a later stage. For instance,

• Union strike done by the labor employees
• War between two or more countries

Escalation of commitment phenomenon means when an individual or a party keeps pouring money in a venture inspite of knowing that the expected cost in future would be much more than the benefits retrieved from the same.

The psychological reasons behind the escalation of commitment phenomenon are as :

• As the individual has invested large amount of money and efforts into it so he cannot take a decision all of a sudden to close it down.
• Expectancy theory suggests that if the decision makers pour in additional resources, it would lead to goal attainment and thus they keep poring resources into the same.
• Past experience might have compelled the decision maker when he has earned decent profit in the similar scenario and thus gets compelled to pour in additional resources expecting the future might be bright as it had happened in the past. History repeats.