Incentivising behavioural change: The role of time preferences

Season 1, Episode 45,  Oct 07, 2020, 10:08 AM

Bundling payment incentives over time is more effective in increasing effort among the impatient, relative to increasing payment frequency

Incentivising people to lead healthier lives by means of monetary payments is a simple and cost-effective intervention, but are there ways to tweak that basic incentive contract to make it work particularly well for people who are impatient (those who discount future benefits for immediate gain)? In this VoxDevTalk, Rebecca Dizon-Ross discusses a randomised experiment that varied the design of payment incentives: bundling payments over time meaningfully increased effort among the impatient relative to the patient; in contrast, increasing payment frequency had limited efficacy, which suggests limited impatience over payments.