Incentives, Commitments, and Habit Formation in Exercise: Evidence from a Field Experiment with Workers at a Fortune-500 Company

Author:

Royer Heather1,Stehr Mark2,Sydnor Justin3

Affiliation:

1. University of California, Santa Barbara, Mail Stop 9210, Santa Barbara, CA 93106 (e-mail: )

2. Drexel University, 3220 Market Street, Philadelphia, PA 19104 (e-mail: )

3. Wisconsin School of Business, University of Wisconsin, Madison, 975 University Ave., Madison, WI 53706 (e-mail: )

Abstract

Financial incentives have shown strong positive short-run effects for problematic health behaviors that likely stem from time inconsistency. However, the effects often disappear once incentive programs end. This paper analyzes the results of a large-scale workplace field experiment to examine whether self-funded commitment contracts can improve the long-run effects of an incentive program. A four-week incentive program targeting use of the company gym generated only small lasting effects on behavior. Those that also offered a commitment contract at the end of the program, however, showed demand for commitment and significant long-run changes, detectable even several years after the incentive ended. (JEL D03, I10, J32)

Publisher

American Economic Association

Subject

General Economics, Econometrics and Finance

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