Topics

Rational Choice with Fixed and Marginal Costs
Fixed versus Sunk Costs
The Sunk Cost Fallacy
Theory and Reactions to Sunk Cost
History and Notes
Rational Explanations for the Sunk Cost Fallacy
Transaction Utility and Flat-Rate Bias
Procedural Explanations for Flat-Rate Bias
Rational Explanations for Flat-Rate Bias
History and Notes
Transaction Utility and Consumer Preferences in Reference
Theory and Reference-Dependent Preferences
Rational Explanations for Context-Dependent Preferences
Biographical Note: Richard H. Thaler
Thought Questions
References
Advanced Concept: Fixed Costs and Rational Choice