: A dual-process approach to cognitive development: The case of children's understanding of sunk cost decisions

Only in recent years have developmental psychologists begun advocating and exploring dual-process theories and their applicability to cognitive development. In this paper, a dual-process model of developments in two processing systems—an "analytic" and an "experiential" system—is discussed. We emphasise the importance of "metacognitive intercession" and developments in this ability to override experiential processing. In each of two studies of sunk cost decisions, age-related developments in normative decisions were observed, as were declines in the use of a "waste not" heuristic. In the second study, children and adolescents were presented with arguments for normative and non-normative sunk cost decisions. Following argument evaluation, participants were re-presented the original problems and a set of novel, transfer problems. Results indicated that post-argument improvements were most apparent during adolescence. Age-related improvements were most noticeable on the transfer problems. In general, the findings suggest that the ability to metacognitively intercede (i.e., reflect on arguments; inhibit experientially produced responses) emerges towards middle adolescence. However, even by the end of adolescence, in the absence of significant contextual cues and motivation, this ability is infrequently utilised. Notes The mean age of children in Study 1 of Baron et al. (Citation1993) was 12.1 years. The standard reported deviation (1.6 yrs.) indicates that most children were between 10.5 and 13.7 years. Hence, small sample size could have interacted with a restricted age range to mask developmental differences. From the normative perspective, the amount of time, effort, or money invested in a project should have no bearing on decisions to abandon or continue a decision. Psychologically, however, "amount" has a significant impact on the SC decisions of adults (McCarthy et al., Citation1993). Because the present research was largely exploratory, "amount" was not manipulated. Instead, the SC problems were piloted with adults to ensure that investments were sufficiently large to activate the sense that "a lot" would be "lost" if a decision were abandoned. Additional research is needed to determine whether, for example, children and adolescents have different thresholds for the level of investment required before they commit the SC fallacy.