Mental Accounting Matters.

Thaler, R. H. (1999). Mental Accounting Matters. Journal of Behavioral Decision Making, 12(3), 183-206.

Type

Journal article

Intellectual base

Primary research

Year

1999

DOI

10.1002/(sici)1099-0771(199909)12:3

Link

https://doi.org/10.1002/(SICI)1099-0771(199909)12:3<183::AID-BDM318>3.0.CO;2-F

Cited from

behavioral_economics, economics_finance

Cited by

2 citations across 2 artifacts.

Each citation links to the sentence it supports in the citing article.

Primes

• Fungibility
  • Money is the canonical fully-fungible substance, yet even money is partly non-fungible (mental accounting, marked bills, sanctioned wallets); commodities are fungible within a grade-and-batch class but not across; carbon credits are constructed to be fungible, but their fungibility is a regulatory artifact contested at every margin.

    This sourceDocuments systematic human violations of money's fungibility — earmarking, source-dependent spending — so a gift voucher or tax refund spends unlike cash.

• Sunk Cost and Irreversible Commitment
  • Behavioral economics and finance: Escalation of commitment in investments; continuation of projects despite negative net present value; sunk-cost fallacy in asset holding and trading; persistence with losing financial positions, with mental-accounting mechanisms that Thaler (1999) traced through investor and consumer behavior.

    This sourceDevelops the mental-accounting framework explaining how investors and consumers segregate past expenditures into accounts that resist closing at a loss; mechanistic basis for sunk-cost effects in financial behavior.

Verification

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