Question

question 8

given the principles of escalating commitment, in which situation described below would you give the greatest funding to the same program in 1995?

• after you funded the program in 1993, it turned out to be very profitable.
• after another manager funded the program in 1993, it turned out to be very profitable.
• after you funded the program in 1993, it turned out to be a \loser,\ showing actual prospects of failing.
• after another manager funded the program in 1993, it turned out to be a \loser,\ showing actual prospects of failing.

Explanation:

Define escalation of commitment

Using the Escalation of Commitment knowledge point

Escalation of commitment is a human behavior pattern in which an individual or group facing increasingly negative outcomes from a decision, action, or investment nevertheless continues the behavior instead of altering course.

Analyze key psychological drivers

Using the Escalation of Commitment knowledge point

The phenomenon is most pronounced when:

• The decision-maker feels personally responsible for the initial choice (self-justification theory).
• The project is failing or showing negative feedback (a "loser"), prompting the original decision-maker to invest more resources to prove their initial decision was correct.

Evaluate the given scenarios

Using the Escalation of Commitment knowledge point

• Scenario 1 (You funded, profitable): Rational reinvestment in a successful project, not escalation of commitment.
• Scenario 2 (Another manager funded, profitable): Rational reinvestment in a successful project.
• Scenario 3 (You funded, failing): High personal responsibility combined with negative feedback. This is the classic condition that triggers the strongest escalation of commitment.
• Scenario 4 (Another manager funded, failing): Low personal responsibility, making it easier to cut losses rather than escalate.

Determine the highest funding scenario

Using the Escalation of Commitment knowledge point

Therefore, you would allocate the greatest funding to a failing program when you were the one who made the initial decision to fund it in 1993.

Answer:

• After you funded the program in 1993, it turned out to be very profitable.
• After another manager funded the program in 1993, it turned out to be very profitable.
• After you funded the program in 1993, it turned out to be a "loser," showing actual prospects of failing. (Correct answer)
• After another manager funded the program in 1993, it turned out to be a "loser," showing actual prospects of failing.