Don't Cry Over Spilled Milk or Wasted Concert Tickets

The other day, the FutureDJ and I were threatened with the negative consequences of our inaction. MBAMama had purchased four tickets to an indie band as per the request of the little broski and myself, with the anticipation that he and I would be bringing a couple friends. Broski's friend bailed and I very quickly discovered that my friends would be back from finals the following week.

Thursday afternoon:
"I'm not really feelin' it," commented Broski.
"Me neither," I answered, hoping first to side with my brother and second to leverage the cumulative past 21 years of semi-responsible oldest sibling cred.
"WHAT? Are you serious? I paid $12 apiece for you to go see this concert and you aren't going? No. You are going and you are paying me back for not following through."

Another day, another economics lesson! Though paid for with a credit card (I'm not opening that can of beans, thank you very much!), the concert tickets were paid for as soon as Mommy dearest clicked the "purchase" button on ticketmaster. At that point, we were technically owners of the tickets, free to use or not use them as we please. This phenomenon is called a sunk cost in economics.

It's also associated with a fallacious perception of waste. I'm sure you've encountered it. Grandma, child of the Great Depression force-feeds the grandkids the last of the leftover mac and cheese to the tune of "waste not, want not." Although Grandma clearly has the agenda of fattening us up, the validity of which I am certain, you don't have to eat the last crusts of mac and cheese. It's already made. It's your choice as to whether you will actually eat it. And don't you bring the "starving children in Africa" into this. We are rational people, here!

Though MBAMama knows about sunk costs, she also knows that self-interested kids can have the propensity to introduce unnecessary spending into the family budget. She knows that when we feel a lightening of our own wallets, incentives really start kicking in. And that corresponds to real internal emotional responses that deepens the brain-grooves of convincing, cajoling, punishing, encouraging, and all the rest that is parenting.

If you want a more in-depth example of sunk costs, check out The Sunk Cost Fallacy by You're Not So Smart. Good stuff.