Nudges in Exercise Commitment Contracts: A Randomized Trial

Abstract

We consider the welfare consequences of nudges to encourage exercise habit formation. We analyze a randomized trial of nudged exercise commitment contracts using a time-inconsistent intertemporal utility maximization model of the demand for exercise. Our empirical analysis shows that people who are interested in exercise commitment contracts choose longer contracts when nudged to do so, are then more likely to meet their pre-stated exercise goals, and to sign subsequent contracts. Our theoretical analysis of the welfare implications of these effects shows conditions under which nudges can reduce utility even when they succeed in the goal of promoting habitual exercise.