walkitout (walkitout) wrote,
walkitout
walkitout

sunk costs and SUVs

I whined about this in an earlier post, but I'm going to separate out this set of links because I went _looking_ for people who had the sense to discuss the sell-SUV-or-not decision with conscious awareness of the sunk costs fallacy. Amazingly enough, _even people who included the fallacy explicitly as a fallacy_ continued to make it.

Exhibit A:

http://www.articlesbase.com/suvs-articles/dont-trade-in-that-suv-yet-486619.html

So close! But then a really fucked up definition of what the sunk costs are in this situation, to essentially define away the relevant sunk cost. Really, what we're talking about here is letting trade-in-before-fuel-price-run-up vs trade-in-now drive a bad decision. And this person says that doesn't count as part of "sunk cost".

This blogger recognizes the error, but is still going to put off selling the SUV:

http://www.thoughtgadgets.com/2008/07/fallacy-of-sunk-costs-or-why-you-cant.html

This thread is amazing, in that it starts out with a _really brilliant decision_ that is then being questioned by the person describing it.

http://www.city-data.com/forum/automotive/358450-really-worth-trading-suv-small-car.html

Sure, it'll probably take 3.5 years or whatever for it to pay out to have made the swap. But if they'd _waited_ even a few weeks to sell their Expedition, it would have taken a helluva lot longer, because there's no way they'd have gotten as good a deal on their trade-in as they did. Poster shows no particular awareness of this (but that makes sense, actually). (The assumption about trading vehicles every 3.5 years is pretty aggressive these days anyway, IIRC.) There are some moronoic followups (scooters that apparently start at $4k, etc.), but in general, the level of discourse is surprisingly high.
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