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Incentives to Exercise

31 Pages Posted: 1 Jun 2006 Last revised: 8 Mar 2009

Gary Charness

University of California, Santa Barbara - Department of Economics

Uri Gneezy

University of California, San Diego (UCSD) - Rady School of Management

Date Written: December 18, 2008

Abstract

Can incentives be effective when trying to encourage the development of good habits? We investigate the effect of paying people a non-trivial amount of money to attend an exercise facility over a period of time. We find that doing so leads to an attendance level that is twice as high as the level when people have not been paid, even well after the end of the intervention. This result is driven primarily by the impact on non-users (people who did not previously attend the gym), as regular users are essentially unaffected. We observe no difference across gender. Even though personal incentives to exercise are already in place, it appears that the financial incentive serves as a catalyst to get some people past the threshold of actually getting started with an exercise regimen. We argue that there is scope for financial intervention in habit formation, particularly in the area of health.

Keywords: Intrinsic incentives, extrinsic incentives, habits, exercise, crowding-out, motivation, health

JEL Classification: A13, B49, C99, I10

Suggested Citation

Charness, Gary and Gneezy, Uri, Incentives to Exercise (December 18, 2008). Available at SSRN: https://ssrn.com/abstract=905026 or http://dx.doi.org/10.2139/ssrn.905026

Gary Charness (Contact Author)

University of California, Santa Barbara - Department of Economics ( email )

2127 North Hall
Santa Barbara, CA 93106
United States
805-893-2412 (Phone)
805-893-8830 (Fax)

Uri Gneezy

University of California, San Diego (UCSD) - Rady School of Management ( email )

9500 Gilman Drive
Rady School of Management
La Jolla, CA 92093
United States

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