Escalation of commitment

Escalation of commitment is the institutional tendency to increase investment in a failing course of action in proportion to the magnitude of prior investment — a dynamic first documented by Barry Staw in 1976 and later generalized to organizational behavior, public policy, and military strategy. The phenomenon is not merely individual irrationality scaled up; it is a property of organizations that diffuses accountability, rewards persistence over truth, and treats reversal as admission of failure rather than evidence of learning.

The mechanism is sunk cost fallacy operating through institutional incentives: decision-makers who advocated for the original investment have reputational stakes in its success, and the organizational culture treats abandonment as weakness. The result is a feedback loop in which failure increases commitment rather than triggering reassessment. In project management, this dynamic is one of the primary causes of cost overruns and schedule slips; in foreign policy, it explains military interventions that continue long after strategic objectives have become unattainable.

Escalation of commitment is the organizational equivalent of a positive feedback loop in which the cost of admitting error rises with each additional investment, making the rational choice — termination — progressively more psychologically and politically expensive. The system does not merely resist change; it accelerates toward the cliff.