IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp10874.html
   My bibliography  Save this paper

Can Financial Incentives Help People Trying to Establish New Habits? Experimental Evidence with New Gym Members

Author

Listed:
  • Carrera, Mariana

    (Case Western Reserve University)

  • Royer, Heather

    (University of California, Santa Barbara)

  • Stehr, Mark

    (Drexel University)

  • Syndor, Justin

    (University of Wisconsin-Madison)

Abstract

We conducted a randomized controlled trial testing the effect of modest incentives to attend the gym among new members of a fitness facility, a population that is already engaged in trying to change a health behavior. Our experiment randomized 836 new members of a private gym into a control group, receiving a $30 payment unconditionally, or one of 3 incentive groups, receiving a payment if they attended the gym at least 9 times over their first 6 weeks as members. The incentives were a $30 payment, a $60 payment, and an item costing $30 that leveraged the endowment effect. These incentives had only moderate impacts on attendance during members' first 6 weeks and no effect on their subsequent visit trajectories. We document substantial overconfidence among new members about their likely visit rates and discuss how overconfidence may undermine the effectiveness of a modest incentive program.

Suggested Citation

  • Carrera, Mariana & Royer, Heather & Stehr, Mark & Syndor, Justin, 2017. "Can Financial Incentives Help People Trying to Establish New Habits? Experimental Evidence with New Gym Members," IZA Discussion Papers 10874, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp10874
    as

    Download full text from publisher

    File URL: http://ftp.iza.org/dp10874.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Rohde, Kirsten I.M. & Verbeke, Willem, 2017. "We like to see you in the gym—A field experiment on financial incentives for short and long term gym attendance," Journal of Economic Behavior & Organization, Elsevier, vol. 134(C), pages 388-407.
    2. Heather Royer & Mark Stehr & Justin Sydnor, 2015. "Incentives, Commitments, and Habit Formation in Exercise: Evidence from a Field Experiment with Workers at a Fortune-500 Company," American Economic Journal: Applied Economics, American Economic Association, vol. 7(3), pages 51-84, July.
    3. Hengchen Dai & Katherine L. Milkman & Jason Riis, 2014. "The Fresh Start Effect: Temporal Landmarks Motivate Aspirational Behavior," Management Science, INFORMS, vol. 60(10), pages 2563-2582, October.
    4. Steven D. Levitt & John A. List & Susanne Neckermann & Sally Sadoff, 2016. "The Behavioralist Goes to School: Leveraging Behavioral Economics to Improve Educational Performance," American Economic Journal: Economic Policy, American Economic Association, vol. 8(4), pages 183-219, November.
    5. Augurzky, Boris & Bauer, Thomas K. & Reichert, Arndt R. & Schmidt, Christoph M. & Tauchmann, Harald, 2012. "Does Money Burn Fat? Evidence from a Randomized Experiment," IZA Discussion Papers 6888, Institute of Labor Economics (IZA).
    6. Mariana Carrera & Heather Royer & Mark Stehr & Justin Sydnor, 2020. "The Structure of Health Incentives: Evidence from a Field Experiment," Management Science, INFORMS, vol. 66(5), pages 1890-1908, May.
    7. Cawley, John & Price, Joshua A., 2013. "A case study of a workplace wellness program that offers financial incentives for weight loss," Journal of Health Economics, Elsevier, vol. 32(5), pages 794-803.
    8. Dan Acland & Matthew R. Levy, 2015. "Naiveté, Projection Bias, and Habit Formation in Gym Attendance," Management Science, INFORMS, vol. 61(1), pages 146-160, January.
    9. Acland, Dan & Levy, Matthew R., 2015. "Naiveté, projection bias, and habit formation in gym attendance," LSE Research Online Documents on Economics 66147, London School of Economics and Political Science, LSE Library.
    10. Gary Charness & Uri Gneezy, 2009. "Incentives to Exercise," Econometrica, Econometric Society, vol. 77(3), pages 909-931, May.
    11. Philip Babcock & Kelly Bedard & Gary Charness & John Hartman & Heather Royer, 2015. "Letting Down The Team? Social Effects Of Team Incentives," Journal of the European Economic Association, European Economic Association, vol. 13(5), pages 841-870, October.
    12. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard H, 1990. "Experimental Tests of the Endowment Effect and the Coase Theorem," Journal of Political Economy, University of Chicago Press, vol. 98(6), pages 1325-1348, December.
    13. Philip S. Babcock & John L. Hartman, 2010. "Networks and Workouts: Treatment Size and Status Specific Peer Effects in a Randomized Field Experiment," NBER Working Papers 16581, National Bureau of Economic Research, Inc.
    14. List, John A. & Samek, Anya Savikhin, 2015. "The behavioralist as nutritionist: Leveraging behavioral economics to improve child food choice and consumption," Journal of Health Economics, Elsevier, vol. 39(C), pages 135-146.
    15. Paloyo, Alfredo R. & Reichert, Arndt R. & Reuss-Borst, Monika & Tauchmann, Harald, 2015. "Who responds to financial incentives for weight loss? Evidence from a randomized controlled trial," Social Science & Medicine, Elsevier, vol. 145(C), pages 44-52.
    16. Stefano DellaVigna & Ulrike Malmendier, 2006. "Paying Not to Go to the Gym," American Economic Review, American Economic Association, vol. 96(3), pages 694-719, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Katare, Bhagyashree, 2021. "Do low-cost economic incentives motivate healthy behavior?," Economics & Human Biology, Elsevier, vol. 41(C).
    2. Stecher, Chad & Mukasa, Barbara & Linnemayr, Sebastian, 2021. "Uncovering a behavioral strategy for establishing new habits: Evidence from incentives for medication adherence in Uganda," Journal of Health Economics, Elsevier, vol. 77(C).
    3. Jan Marcus & Thomas Siedler & Nicolas R. Ziebarth, 2021. "The Long-Run Effects of Sports Club Vouchers for Primary School Children," CEPA Discussion Papers 34, Center for Economic Policy Analysis.
    4. Bialowolski, Piotr & Weziak-Bialowolska, Dorota & McNeely, Eileen, 2021. "A socially responsible financial institution – The bumpy road to improving consumer well-being," Evaluation and Program Planning, Elsevier, vol. 86(C).
    5. Finkelstein, Eric A. & Bilger, Marcel & Baid, Drishti, 2019. "Effectiveness and cost-effectiveness of incentives as a tool for prevention of non-communicable diseases: A systematic review," Social Science & Medicine, Elsevier, vol. 232(C), pages 340-350.
    6. Homonoff, Tatiana & Willage, Barton & Willén, Alexander, 2020. "Rebates as incentives: The effects of a gym membership reimbursement program," Journal of Health Economics, Elsevier, vol. 70(C).
    7. Mariana Carrera & Heather Royer & Mark Stehr & Justin Sydnor, 2020. "The Structure of Health Incentives: Evidence from a Field Experiment," Management Science, INFORMS, vol. 66(5), pages 1890-1908, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Itzik Fadlon & Torben Heien Nielsen, 2019. "Family Health Behaviors," American Economic Review, American Economic Association, vol. 109(9), pages 3162-3191, September.
    2. Manuela Angelucci & Silvia Prina & Heather Royer & Anya Samek, 2015. "When Incentives Backfire: Spillover Effects in Food Choice," NBER Working Papers 21481, National Bureau of Economic Research, Inc.
    3. Cappelen, Alexander W & Charness, Gary & Ekström, Mathias & Gneezy, Uri & Tungodden, Bertil, 2017. "Exercise Improves Academic Performance," Working Paper Series 1180, Research Institute of Industrial Economics.
    4. Carrera, Mariana & Royer, Heather & Stehr, Mark & Sydnor, Justin & Taubinsky, Dmitry, 2018. "The limits of simple implementation intentions: Evidence from a field experiment on making plans to exercise," Journal of Health Economics, Elsevier, vol. 62(C), pages 95-104.
    5. Mariana Carrera & Heather Royer & Mark Stehr & Justin Sydnor, 2020. "The Structure of Health Incentives: Evidence from a Field Experiment," Management Science, INFORMS, vol. 66(5), pages 1890-1908, May.
    6. Condliffe, Simon & Işgın, Ebru & Fitzgerald, Brynne, 2017. "Get thee to the gym! A field experiment on improving exercise habits," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 70(C), pages 23-32.
    7. Homonoff, Tatiana & Willage, Barton & Willén, Alexander, 2020. "Rebates as incentives: The effects of a gym membership reimbursement program," Journal of Health Economics, Elsevier, vol. 70(C).
    8. Muller, Paul & Habla, Wolfgang, 2018. "Experimental and non-experimental evidence on limited attention and present bias at the gym," ZEW Discussion Papers 18-041, ZEW - Leibniz Centre for European Economic Research.
    9. Rohde, Kirsten I.M. & Verbeke, Willem, 2017. "We like to see you in the gym—A field experiment on financial incentives for short and long term gym attendance," Journal of Economic Behavior & Organization, Elsevier, vol. 134(C), pages 388-407.
    10. Kirgios, Erika L. & Mandel, Graelin H. & Park, Yeji & Milkman, Katherine L. & Gromet, Dena M. & Kay, Joseph S. & Duckworth, Angela L., 2020. "Teaching temptation bundling to boost exercise: A field experiment," Organizational Behavior and Human Decision Processes, Elsevier, vol. 161(S), pages 20-35.
    11. Katare, Bhagyashree, 2021. "Do low-cost economic incentives motivate healthy behavior?," Economics & Human Biology, Elsevier, vol. 41(C).
    12. Augurzky, Boris & Bauer, Thomas K. & Reichert, Arndt R. & Schmidt, Christoph M. & Tauchmann, Harald, 2018. "Habit formation, obesity, and cash rewards," Ruhr Economic Papers 750, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    13. Harris, Matthew C. & Kessler, Lawrence M., 2019. "Habit formation and activity persistence: Evidence from gym equipment," Journal of Economic Behavior & Organization, Elsevier, vol. 166(C), pages 688-708.
    14. Belot, Michèle & James, Jonathan & Nolen, Patrick, 2016. "Incentives and children's dietary choices: A field experiment in primary schools," Journal of Health Economics, Elsevier, vol. 50(C), pages 213-229.
    15. Allais, Olivier & Bazoche, Pascale & Teyssier, Sabrina, 2017. "Getting more people on the stairs: The impact of point-of-decision prompts," Social Science & Medicine, Elsevier, vol. 192(C), pages 18-27.
    16. Fricke, Hans & Lechner, Michael & Steinmayr, Andreas, 2018. "The effects of incentives to exercise on student performance in college," Economics of Education Review, Elsevier, vol. 66(C), pages 14-39.
    17. Christina Gravert & Linus Olsson Collentine, 2019. "When nudges aren't enough: Incentives and habit formation in public transport usage," CEBI working paper series 19-10, University of Copenhagen. Department of Economics. The Center for Economic Behavior and Inequality (CEBI).
    18. Ozturk, Orgul D. & Frongillo, Edward A. & Blake, Christine E. & McInnes, Melayne M. & Turner-McGrievy, Gabrielle, 2020. "Before the lunch line: Effectiveness of behavioral economic interventions for pre-commitment on elementary school children's food choices," Journal of Economic Behavior & Organization, Elsevier, vol. 176(C), pages 597-618.
    19. Giacomo Calzolari & Mattia Nardotto, 2017. "Effective Reminders," Management Science, INFORMS, vol. 63(9), pages 2915-2932, September.
    20. Nan Yang & Yong Long Lim, 2018. "Temporary Incentives Change Daily Routines: Evidence from a Field Experiment on Singapore’s Subways," Management Science, INFORMS, vol. 64(7), pages 3365-3379, July.

    More about this item

    Keywords

    endowment effect; incentives; exercise; overconfidence;
    All these keywords.

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D3 - Microeconomics - - Distribution
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp10874. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Holger Hinte (email available below). General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.