Latest / Behavioral Economics with Fexingo: Decision Making, Bias, and How People Really Spend
The Sunk Cost Fallacy in Big Infrastructure Projects
In this episode of Behavioral Economics with Fexingo, Lucas and Luna explore the sunk cost fallacy as it plays out in massive public infrastructure projects. Using the example of a European rail tunnel that overran its budget by billions, they discuss why it's so hard to walk away from a failing project once you've poured resources in. They break down the psychological drivers, from loss aversion to commitment consistency, and contrast these with private-sector decisions, like how a tech company might kill a failing product. The episode also touches on how to apply these lessons to…
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