Escalation of commitment was first described by Barry M. Staw in his 1976 paper, “Knee deep in the big muddy: A study of escalating commitment to a chosen course of action”.  More recently the term Sunk cost fallacy has been used to describe the phenomenon where people justify increased investment in a decision, based on the cumulative prior investment, despite new evidence suggesting that the decision was probably wrong.  Such investment may include money (known informally as “throwing good money after bad”), time, or — in the case of military strategy — human lives.

The term is also used to describe poor decision-making in business, government, information systems in general, software project management in particular, politics, and gambling.  The term has been used to describe the United States commitment to military conflicts including Vietnam in the 1960s – 1970s and in Iraq in the 2000s, where dollars spent and lives lost justify continued involvement.

Alternatively, Irrational escalation (sometimes referred to as irrational escalation of commitment or commitment bias) is a term frequently used in psychology, philosophy, economics, and game theory to refer to a situation in which people can make irrational decisions based upon rational decisions in the past or to justify actions already taken.  Examples are frequently seen when parties engage in a bidding war; the bidders can end up paying much more than the object is worth to justify the initial expenses associated with bidding (such as research), as well as part of a competitive instinct.

While not strictly applicable to Kryptos, the “Dollar Auction” thought-experiment will show a wonderful description of this effect.

The dollar auction is a non-zero sum sequential game designed by economist Martin Shubik to illustrate a paradox brought about by traditional rational choice theory in which players with perfect information in the game are compelled to make an ultimately irrational decision based completely on a sequence of rational choices made throughout the game.

The setup involves an auctioneer who volunteers to auction off a dollar bill with the following rule: the dollar goes to the highest bidder, who pays the amount he bids.  The second-highest bidder also must pay the highest amount that he bid, but gets nothing in return.  Suppose that the game begins with one of the players bidding 1 cent, hoping to make a 99 cent profit.  He will quickly be outbid by another player bidding 2 cents, as a 98 cent profit is still desirable.  Similarly, another bidder may bid 3 cents, making a 97 cent profit.  Alternatively, the first bidder may attempt to convert their loss of 1 cent into a gain of 97 cents by also bidding 3 cents.  In this way, a series of bids is maintained.  However, a problem becomes evident as soon as the bidding reaches 99 cents.  Supposing that the other player had bid 98 cents, they now have the choice of losing the 98 cents or bidding a dollar even, which would make their profit zero.  After that, the original player has a choice of either losing 99 cents or bidding $1.01, and only losing one cent.  After this point the two players continue to bid the value up well beyond the dollar, and neither stands to profit.

The dollar auction is often used as a simple illustration of the irrational escalation of commitment.  By the end of the game, though both players stand to lose money, they continue bidding the value up well beyond the point that the dollar difference between the winner’s and loser’s loss is negligible; they are fueled to bid further by their past investment.

The process is fascinating but consider that people will continue to work on Kryptos far past the point they would have originally committed to pursuing a solution simply because they’ve already spent so much time on it.  Alternately, they will continue with certain ideas or methods simply because they’ve put so much time and thought and energy into them that it becomes hard to abandon them.

I can’t imagine this heuristic phenomenon is strictly limited to Kryptos enthusiasts as far as the context of problem-solving hobbyists.