Division of the Humanities and Social Sciences California Institute of Technology Pasadena, California 91125 the Econometrics and Behavioral Economics of Escalation of Commitment: a Re-examination of Staw & Hoang's Nba Data
نویسندگان
چکیده
We examine the phenomenon of escalation from an economist's perspective, emphasizing explanations which do not rule out rational behavior on the part of rms or agents. We argue that escalation cannot be established as a separate phenomenon unless these possible alternative explanations are properly accounted for. We present Staw and Hoang's (1995) study of NBA data as an instance of where evidence of escalation might be overturned upon more careful analysis. After performing several tests of our alternative explanations, we nd that evidence of escalation persists, although it is weaker both in duration and magnitude. JEL classi cation: D23
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Division of the Humanities and Social Sciences, California Institute of Technology, Pasadena, CA 91125; Faculty of Business and Economics, The University of Melbourne, Carlton, VIC 3010, Australia; Florey Institute of Neuroscience and Mental Health, The University of Melbourne, Parkville, VIC 3052, Australia; and Computation and Neural Systems, California Institute of Technology, Pasadena, CA 9...
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