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million. In this case, exit costs reinforced the initial psychological overcommitment: the<br />
Prime Minister of British Columbia feared loss of election on termination, contracts would<br />
have to be breached, and outside vendors would make losses from investments made in<br />
anticipation of the fair.<br />
Staw (1987) lists management practices which limit over:ommitment: administrative<br />
turnover, low cost to executives for admitting failure, lack of ambiguity in data regarding<br />
performance, allowing losses to be blamed on exonerating circumstances, separating<br />
termination decisions from initiation decisions, and considering from the beginning the costs<br />
and procedures of project termination.<br />
IV. Indoctrination and Obedience<br />
Irrational obedience to authority is a second type of "pathological," time inconsistent<br />
behavior with important social and economic ramifications. Procrastination occurs when there<br />
is a fixed cost of action today and current costs are more salient than future costs. Undue<br />
obedience to authority may occur as a form of procrastination if disobedience of an authority<br />
is salient and distasteful. In addition, authority may be particularly powerful when<br />
yesterday's actions affect the norms of today's behavior. Both such influences--the salience<br />
of current disobedience and a shift in the utility of subjects in accordance with their prior<br />
actions--are present in Milgram's experiments, which I shall review.<br />
The subjects in the Milgram experiment were adult males, recruited by a mail circular<br />
requesting participation in an experiment purportedly concerning the effects of punishment on<br />
memory. The subjects were assigned the role of teacher, while an accomplice of the<br />
experimenter, a professional actor, played the role of learner. The subjects were instructed to<br />
administer shocks to the learner when he gave wrong answers. The shocks were a learner<br />
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