Escalation Bias: Does it Extend to Marketing?
Journal of the Academy of Marketing Science, Vol. 21, No. 3, pp. 247-253, 1993
11 Pages Posted: 11 Feb 2005 Last revised: 31 Dec 2011
Escalation bias implies that managers favor reinvestments in projects that are doing poorly over those doing well. We tested this implication in a marketing context by conducting experiments on advertising and product-design decisions. Each situation was varied to reflect either a long-term or a short-term decision. Besides these four conditions, we conducted three replications. We found little evidence of escalation bias by 365 subjects in the seven experimental comparisons.
Keywords: Escalation bias, marketing, management, decisiong making
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