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

Financial incentives have been shown to have strong positive short-run effects for problematic health behaviors, but 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 improve the long-run effects of incentive programs. Consistent with existing findings, workers responded strongly to an incentive targeting use of the company gym, but long-run effects were modest, at best. However, workers in the treatment arm that combined the incentive program with a commitment contract option showed long-lasting behavioral changes, persisting even 1 year after the incentive ended