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Temporal Attention, the Sunk Cost Effect, and Delay Discounting
Sofis, Michael
Sofis, Michael
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Abstract
The sunk cost effect, known as the degree to which an initial investment of time, effort, or money increases the likelihood of continued investment, and delay discounting, defined as how rapidly the subjective value of a reward declines as a function of the delay to its receipt, incorporate the role of temporally distant stimuli, but have not been evaluated simultaneously. One process that may link the two phenomena is the temporal attention hypothesis, which holds that the degree to which one perceives distant events as close to the present, and one’s ability to shift their temporal focus from now to not now, jointly contributes to the mechanism of delay discounting. The first of the two experiments showed that participants with higher subjective time perception (i.e., perceived distant objective time points as subjectively closer to the present) committed more sunk cost across hypothetical temporal gaps between the initial and terminal links, and exhibited lower rates of delay discounting than those with lower subjective time perception. In Experiment 2, the same sunk cost procedure was used, except that four temporal gap conditions were used that matched the time points used in the delay discounting task. Further, participants experienced either negative, neutral, or positively valenced income narratives, which have previously been shown to alter rates of delay discounting. Additionally, probed time points in the future and past subjective time perception tasks more closely matched those used in the delay discounting and sunk cost tasks, and both future and past subjective time perception were derived used Mazur’s (1987) hyperbolic model. A series of Quade non-parametric ANCOVAs failed to reveal a significant effect of income narrative on delay discounting, any measure of sunk cost, future or past subjective time perception, and past, present, and future temporal focus. Extra sum of squares tests revealed, however, that hyperboloid models of mean sunk cost and median indifference data across the three groups were better fit to separate curves than one curve. Hyperbolic decline in subjective time perception (Ln (k)) for future and past subjective time perception were strongly correlated and were combined together to form the measure joint time perception, which correlated with delay discounting, but did not correlate with any measure of sunk cost. Future subjective time perception was divided by past subjective time perception to form the measure of time perception index, which was only correlated with sunk cost measures, but not delay discounting. Overall sunk cost (i.e., terminal investment percentage of $5 initial investments subtracted by $35 initial investments) was directly correlated with delay discounting such that greater amounts of sunk cost related to lower rates of delay discounting, providing added evidence that the sunk cost effect may relate to lower rates of discounting. Implications, limitations, and future directions related to these findings are discussed.
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Date
2018-08-31
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University of Kansas
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Keywords
Behavioral psychology, Behavioral Economics, Delay Discounting, Income Narratives, Subjective Time Perception, Sunk Cost Effect