Reply to post: Re: Making life easier - for an adversary

Yes, British F-35 engines must be sent to Turkey for overhaul

Anonymous Coward
Anonymous Coward

Re: Making life easier - for an adversary

>> Well no, if you're willing to write off the £6bn already committed on the carriers.

> I would like to introduce you to the sunk cost fallacy.

As a reader of the Economist I'd like to introduce you to some concepts that Sunk Cost Fallacy doesn't adequately address.

1. That 'reputational damage' is an inconsequential cost. This is not true in the real world where subsequent decisions are viewed in light of previous actions. i.e. Why should I believe anything this person says when they can change their mind in an instant after I've committed real world resources. By far the best current example of this I can think of is Herr Drumpf, would you commit resources, at your risk, to anything that man promised even if you had an air tight contract?

2. That decisions where Sunk Cost is a consideration are taken in a vacuum. You can choose to write off the £6bn for the carriers if you wish. However the 'below the line' intangible costs on things like Navy morale, world perception of Britain (I accept this is highly subjective....but many people still see the Royal Navy as one of the few Blue Water navies in existence) are not easily measured.

3. That whenever it comes to any economic theory I'm always reminded of the old joke.

How many economists does it take to plug in a light bulb?

None.

Being economists they'll just assume it's still light.

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