The investments required might include specialized and specific assets, creating sunk costs and increasing transaction costs.

The Panel notes that such payments are “sunk” costs that were incurred prior to Iraq's invasion and occupation of Kuwait.

Otherwise, shortage of supply and deteriorating quality of service could occur, particularly as infrastructure services had high capital costs, and investment in fixed assets entailed sunk costs.

These include sunk costs in current activities (for instance, trees with long gestation periods) and lack of skills in producing and marketing alternative products.

But if there are no new investment opportunities on thehorizon, squabbling is less costly, because the existing plant andmachinery are already sunk costs.

Direct and indirect costs, Fixed and variable costs, Period and product costs, Controllable and uncontrollable costs, Avoidable and unavoidable costs, “Sunk” costs, Budgeted, standard and actual costs and their comparisons and analyses

Relevant costs, such as fixed or variable, direct or indirect, avoidable or unavoidable, and opportunity or sunk costs, Appropriate techniques, such as cost/volume/profit analysis, the use of limiting factors, and the recognition of risks and uncertainties

As the capital-intensity and sunk costs of building power-generation plants or electricity distribution require long period financing periods, donors could also extend financing of energy projects to cover costs from start to finish.

The third reason, which has a bearing on regulation and competition, is that these industries often involve considerable barriers to entry or exit, such as sunk costs which are unrecoverable once they have been committed.

The third reason, which has a bearing on regulation and competition, is that these industries often involve considerable barriers to entry or exit, such as sunk costs which are unrecoverable after the fact.