Summary: Many people have strong misgivings about “wasting” resources. This is called “loss aversion”. In the above example involving a non-refundable movie ticket, many people, for example, would feel obliged to go to the movie despite not really wanting to, because doing otherwise would be wasting the ticket price; they feel they passed the point of no return. This is sometimes called the sunk cost fallacy. Economists would label this behavior “irrational”: it is inefficient because it misallocates resources by depending on information that is irrelevant to the decision being made. Colloquially, this is known as “throwing good money after bad”.

This line of thinking, in turn, may reflect a nonstandard measure of utility, which is ultimately subjective and unique to the consumer. A ticket-buyer who purchases a ticket to a bad movie in advance, makes a semi-public commitment to watching it. To leave early is to make this lapse of judgment manifest to strangers, an appearance he may rationally choose to avoid. Alternatively, he may take pride in having recognized the opportunity cost of the alternative use of time.

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