Carrots and Sticks

Why do sensible plans made in December collapse by January? Ian Ayres’s commitment theory explores one of life’s most predictable paradoxes: we often know what’s good for us but fail to follow through because of time‑inconsistent preferences. The book’s central claim is simple but profound—your future self may not want what your present self wants, so the best way to succeed is to design external constraints that make your future behavior match your current intentions.

The pull of hyperbolic discounting

Behavioral economists call this tendency hyperbolic discounting: you value rewards more when they’re near in time. In experiments by Richard Thaler and George Ainslie, both humans and pigeons switched from patience to impulsivity as delays shortened. You might promise yourself two apples next year instead of one today—but once that apple sits in front of you, you grab it. Ayres uses stories like Alex Moore risking $400 to stop fake sneezing and his own $26,000 weight bet to show that commitment contracts turn insight into execution.

Spock versus Homer: your multiple selves

Richard Thaler’s metaphor—your patient Spock versus your impulsive Homer—explains why commitments matter. You can be naïve, assuming future you will act wisely, or sophisticated, realizing you’ll cave and acting now to bind yourself. Odysseus had his sailors tie him to the mast before facing the Sirens: an archetype of precommitment. Modern versions include software blockers, locked fridges, or stickK.com contracts that risk money to ensure follow‑through. You’re not weak; you’re predictable—and commitments are structured empathy between your selves.

Designing a contract that fits

Ayres demonstrates that commitment is an art of design. You can choose carrots (rewards), sticks (punishments), or even anti‑incentives that make failure psychologically intolerable (like sending your forfeited money to an anti‑charity you despise). The real challenge is to calibrate these incentives so that they motivate effort without deterring participation. Robert Jeffrey’s experiments show that $300 stakes caused greater weight loss than $30 stakes—but also scared off some participants. The “Goldilocks zone” of commitment is a stake strong enough to matter but not ruinous.

Public accountability and social architecture

Commitments thrive on visibility. Social proof, referees, and peers amplify incentives. Energy‑report cards that compare you to your neighbors (OPOWER) reduce consumption; towel cards saying most guests reuse towels increase participation. Likewise, choosing a credible referee or multiple supporters helps ensure enforcement. Public commitments also function as signals—visible evidence of intent that screens for sincerity in relationships, employment, or even public policy (Ayres and Brown’s Fair Employment mark).

Maintaining progress over time

One reason commitments fail is that they stop too soon. Rapid rewards burn out without maintenance. Ayres highlights Ryan Benson’s post‑show relapse from The Biggest Loser and introduces Rena Wing’s Stop Regain program proving that daily weighing—a humble act of mindfulness—prevents backslide. Long‑term success requires resets, feedback loops, and simple, frequent monitoring (like Wing’s green‑yellow‑red scale zones). The contract must evolve into habit.

Core idea

Ayres proposes a unifying vision: commitment devices—whether financial, social, or institutional—let your present self reshape your future incentives. By designing your own Odysseus mast, you transform fleeting willpower into durable structure. The art is not in heroic discipline but in systems that make good behavior the easy path for the future you.

Across its chapters, the book moves from psychology to practical execution, blending laboratory insights with concrete architectures like stickK.com, U.S. wellness programs, and voluntary carbon markets. It’s ultimately about freedom through foresight—using rules you choose, not ones imposed on you, to live closer to what you actually want.

Ayres classifies commitment mechanisms into three families: carrots that reward success, sticks that punish failure, and anti‑incentives that make failure psychologically unattractive. Choosing among them means understanding how you respond to gains and losses.

Carrots: pulling you forward

Carrots attract participants who need positive reinforcement. Roland Fryer’s REACH program gave cash and phone minutes for good grades; Zappos’ $2,000 “quit‑now” offer strengthens employees’ identification with their job by rewarding the refusal of a bribe. Ayres uses these to show that well‑planned carrots serve as active commitment tools—participants opt in to prove dedication.

Sticks: harnessing loss aversion

People feel losses twice as intensely as equivalent gains. Thus, forfeiture contracts work brilliantly. Robert Jeffrey’s trials revealed that men risking $300 lost far more weight than those risking $30. A stick rarely costs you when it succeeds—you keep your money. But overdoing can depress take‑up and trigger backlash once the constraint lifts. Smart design balances deterrence with sustainability.

Anti‑incentives: psychological inversion

Anti‑incentives flip logic by making failure unbearable rather than success sweet. Zappos’ bribe refusal and stickK’s anti‑charity (money goes to a hated organization) exploit identity and emotion, not just economics. These work for users motivated by pride, politics, or shame who might ignore ordinary prices. Tailoring motive to mechanism—status for some, cash risk for others—is the art Ayres insists on.

When to use which

• Use sticks when loss aversion delivers strong leverage and you can enforce truthfully.
• Use carrots to draw participation from hesitant users or low‑income groups.
• Use anti‑incentives when signaling and identity drive action more than money.

Each form carries a psychological story—hope, fear, or pride. Your best contract matches your own narrative of motivation.

How much should you risk to motivate change? Ayres shows that while larger stakes create stronger commitment, they simultaneously reduce participation. Designing the right stake involves trading short‑term enrollment for long‑term effect.

The Jeffrey experiment

Robert Jeffrey’s randomized study on weight loss found that $300 deposits led to about nine extra pounds lost versus $30 deposits, though fewer participants joined. The offering itself—being offered $300—had an average positive effect, showing that incentive magnitude alters both entry and outcome.

Finding the Goldilocks zone

Ayres calls this the Goldilocks problem: stakes too small invite cheating or indifference; stakes too large deter sign‑up or cause rebound once the contract ends. Medium‑sized bets, like $150 deposits in Jeffrey’s follow‑ups, achieved steadier results over a year, avoiding psychological backlash similar to the forbidden‑toy studies—mild threats work longer than severe ones.

Practical calibration

• Start with a stake you can accept psychologically and financially.
• Combine carrots for take‑up with sticks for follow‑through.
• Avoid small recurring fines that become rent—use lump sums or limited renewals.

The lesson: your commitment’s strength rests on your present willingness to sign, not just on future consequences. Pick a stake that both motivates and survives reality.

Pure carrots and sticks sometimes fail—so mix them. Ayres highlights Kevin Volpp’s veterans’ studies, which blended deposit contracts with daily lotteries to exploit multiple behavioral levers at once.

Lotteries: excitement and probability weighting

Humans over‑weight small probabilities (Kahneman & Tversky). Volpp’s subjects played a daily lottery with tiny odds of $100 or moderate odds of $10, producing constant engagement even for meager expected returns. Texts announcing missed winnings created everyday regret, keeping motivation fresh—immediacy without overspending.

Matched deposits: reinforcing dual motivation

Volpp’s deposit‑match scheme combined loss aversion and subsidy: users posted their own deposits, received equal matches, and earned small carrot payments for compliance. This hybrid softened barriers to entry while maintaining discipline. Deposit groups outperformed simple lottery players, proving the synergy of blended designs.

Creative extensions

James Hurman’s smoking‑bet auction added market forces: bidders paid upfront for rights to collect forfeits, giving you instant cash and external judgment. Such contracts reveal confidence levels—prices express perceived odds of success. Hybrids like matches, auctions, or lotteries thus handle participation constraints dynamically.

Ayres’s insight: combine probabilistic fun (lottery carrots) with equity stakes (deposit sticks) to sustain engagement across different personality types. Commitment architecture can be playful yet binding.

Commitment strength depends on social context—who knows about it, who enforces it, and which norms surround it. Ayres shows that social pressure and credible referees multiply the power of small incentives.

Norms and peer comparison

Robert Cialdini’s experiments show that descriptive norms easily backfire: telling people “many visitors steal wood” increased theft, while saying “most preserve” reduced it. Ayres’s OPOWER bills use positive comparison with peers—smiley faces for efficient households—to cut energy use by several percent nationwide.

Credible referees

A referee enforces truth but only if trusted. Barry Nalebuff’s humiliation bets or Rob Harrison’s charity checks demonstrate strong oversight; others falter when friends go easy (Alex Moore’s girlfriend ignored his lateness). The fix: multiple supporters or digital logs so collusion is hard. Reputation systems can make enforcement social rather than bureaucratic.

Groups and sabotage

Group contracts add accountability but also envy. Jeffrey’s group trials and Ayres’s “Dirty Man Competition” reveal both cooperation and sabotage risks. Good designs align payoffs—either group wins together or pays together—to neutralize malicious incentives.

The takeaway: publicity transforms private resolve into social fact. Choose who watches, who judges, and what norms you activate.

Short‑term success often evaporates. Ayres devotes two chapters to preserving gains—through mindfulness, frequent tracking, and planned resets—so commitment becomes maintenance, not just motivation.

Mindfulness through measurement

Rena Wing’s National Weight Control Registry found daily weighing predicts long‑term success. Her Stop Regain trial reinforced this: participants with digital scales and color‑zone feedback regained roughly half as much weight as controls. Data is empowerment—the scale is the simplest behavioral mirror.

Feedback and resets

Programs that escalate rewards for sustained adherence and reset after lapses keep participants engaged. Higgins’s addiction studies and Volpp’s designs show that gentle restarts prevent dropout. Penalties fade after small failures to encourage continuity rather than abandonment.

Simple systems you can use

• Weigh daily or track any controllable input (steps, minutes, words).
• Set objective thresholds—color zones that trigger pre‑defined corrections.
• Share data with a supporter or use small visual rewards for staying green.

Ayres even notes playful momentum tricks—like Kivetz’s coffee‑card illusion of progress—to create early wins. The goal is awareness, not magic: constant micro‑adjustment beats heroic once‑and‑for‑all resolve.

How you frame incentives changes how they work. Ayres applies decades of behavioral research to show that identical rewards can inspire or destroy motivation depending on context and messaging.

Gain vs. loss framing

From the Asian Flu problem to Peter Salovey’s health framing studies, behavior flips when described as avoiding loss rather than achieving gain. Use loss framing for detection behaviors (“Don’t miss cancer signs”) and gain framing for prevention (“Protect your skin”). Effective commitments adopt matching frames.

Crowding‑out pitfalls

Uri Gneezy’s daycare fine shows the danger of pricing norms—charging late fees made lateness acceptable. Small payments can turn moral duties into transactions. Ayres’s experiment on paying students to run reduced attendance the same way. Therefore, either pay enough to matter or pay nothing—the middle insults intrinsic motives.

Reward medium matters

Kivetz and Jeffrey compared cash with indulgence rewards: gift certificates and spa vouchers motivated better because they were memorable and morally justified treats. Choose non‑fungible rewards when you want emotional resonance, not just efficiency.

Framing teaches respect for meaning: incentives alter identity as much as behavior, so design commitments that reinforce, not erode, the values you rely on.

Commitments scale beyond individuals. Ayres’s later chapters envision governments, employers, and markets offering opt‑in commitment tools that create freedom through voluntary constraint.

Governmental architecture

Programs like Illinois’s casino self‑exclusion turn a private promise (“don’t let me gamble”) into legal enforcement. Ayres imagines extensions—a Do Not Pay registry for payday loans or online betting—that align law with behavioral self‑protection. Such tools expand liberty by empowering credible self‑restraint.

Corporate wellness and civil rights marks

Employer health plans like BeniComp link deductibles to biometric success, balancing savings with fairness rules under HIPAA. Ayres and Brown’s Fair Employment mark lets firms contractually adopt future discrimination laws today, creating private litigation rights and signaling equality. Public commitments thus become policy substitutes pending legislation.

Markets and environmental applications

Voluntary carbon exchanges—like Chicago’s pilot—prove that firms can sign up for penalties voluntarily to cut emissions. Ayres proposes household versions, such as independence bonds that trade present rebates for future gas taxes. You can build sustainability through voluntary contracts rather than coercion.

Institutions magnify commitment’s reach: when credible enforcement meets moral choice, self‑control becomes collective progress.

To prove theory in practice, Ayres co‑founded stickK.com with Dean Karlan and Jordan Goldberg—a web platform that standardizes personal commitment contracts. Its story is the book’s practical culmination.

Origin and purpose

Inspired by Karlan’s SEED and CARES saving experiments in the Philippines, stickK launched in 2008 to help people quit smoking, lose weight, or reach custom goals by posting money at risk, appointing referees, and designating charities or anti‑charities for forfeiture. Within a year, 40,000 users had committed over $3 million, with average stakes of $275.

Enforcement structure

Credibility depends on three levers: financial stakes, referees, and supporters. stickK’s forfeiture triggers—missed report, self‑report failure, or referee failure confirmation—maintain discipline without company profit because funds go to chosen recipients. Medical exemptions ensure safety, protecting against self‑harm goals.

Lessons learned

Data shows that multi‑supporter contracts outperform solo ones, and meaningful stakes trump token ones. Referees rarely lie, proving external verification beats self‑report. Too‑large bets can invite deceit (couples colluding to avoid church forfeiture), so social architecture must resist gaming.

stickK symbolizes Ayres’s broader thesis: commitments succeed when transparent, enforceable, and self‑chosen. It’s not punishment—it’s engineered honesty between your present and future selves, accessible with a few clicks.