Marketing Papers

Document Type

Journal Article

Date of this Version

June 1993

Abstract

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.

Comments

Postprint version. Published in Journal of the Academy of Marketing Science, Volume 21, Number 3, Summer 1993, pages 247-253. The author has asserted his/her right to include this material in ScholarlyCommons@Penn.

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Date Posted: 06 July 2006