War of Attrition (Who Quits First)

A contest where participants incur costs while waiting for others to concede, trading future expense against the chance of winning.

A war of attrition is a contest in which participants bear costs while waiting for others to concede. Continuing can preserve a chance of winning a prize, but the resources spent along the way reduce the net value. A winner can end with a loss, though it is not inevitable that every participant would have been better off never entering.

The decision to continue depends on future costs, the prize, outside options, and beliefs about others’ persistence. Past costs are sunk unless they change present resources or future consequences. Long contests can arise in rational game models, so escalation is not by itself proof of sunk-cost bias or irrational pride. Resource reserves matter, but they are not the sole determinant of a sensible stopping decision.

When to use it

Useful when competitors keep spending mainly to outlast one another.

How it can help

Evaluate continuation using future consequences, outside options, and beliefs about opponents.