Tagged: Dean Karlan

USE COMMITMENT CONTRACTS TO ACHIEVE GOALS

A commitment contract is “a contract that binds you into achieving a personal goal.” You set a goal, decide the stakes, designate a referee, and engage supporters. Stakes include money and/or reputation. Recipients of the money include individuals, charities, and “anti-charities” (organizations you’d hate to donate to).

Commitment contracts are an effective way of spurring new habits. In just one example, a study of more than two thousand smokers found that “the smokers offered a commitment contract were nearly 40 percent more likely to be nicotine-free after a year” [Baumeister and Tierney].

The commitment contract was pioneered by the Yale economist Dean Karlan and his colleague the lawyer-economist Ian Ayres, both leading behavioralists. Together they founded stickK.com, a site for creating commitment contracts. While you can replicate many of the aspects of a commitment contract yourself, stickK offers you a legally enforceable agreement and the promise that, if you fail, your friends will find out and your card will be charged.

References:

Ian Ayres. 2010. Carrots and Sticks: Unlock the Power of Incentives to Get Things Done. Bantam.

Roy F. Baumeister and John Tierney. 2011. Willpower: Rediscovering the Greatest Human Strength. Penguin