Applying economic incentives to increase effectiveness of an outpatient weight loss program (TRIO) – A randomized controlled trial
This is a great read on the power of economic incentives. It is also a perfect example of our ability to focus on short term benefits. The results from this study are below:
- At 4 months the incentivised group lost 3.4kg compared to 1.4kg for the control arm.
- At 8 months the incentivised group lost 3.3kg compared to 1.8kg for the control arm.
- At 12 months the incentivised group lost 2.3kg compared to 0.8kg for the control arm.
In both instances there was a decrease in mean weight loss (i.e. less weight lost) over time. This indicates to me that the participants likely worked very hard up front when the incentives were fresh in their mind and over time (as the marginal utility for the incentive decreased) their work ethic likely decreased.
Another interesting behavioral screw the researchers added to this study was a 1 in 10 chance for participants to win the same cash prize as the participants who elect the cash payment option. This is important because another behavioral trait we have is the incredible ability to overestimate our odds of winning. The problem in this instance is the fact that the researchers made the lottery option the same cash prize as the cash payment. Unsurprisingly, the researchers did not find evidence that the lottery option led to greater weight loss. I would suspect a greater lottery prize may influence the results. But this assumes that all the participants have the same risk/reward profile; which will not be the case.