Precommitment

Imagine you decide you want to get into better shape and you therefore start going to the gym. This is a goal you make in your head, without telling anyone. Although you might have the best intentions, as the days go by, you don’t find yourself making it to the gym. Why did your resolution fail?

One reason is because you had no kind of commitment to going to the gym: you didn’t buy a gym membership; you didn’t tell someone else who could hold you accountable; you didn’t even outline the specific days of the week and times of the day that you would go. Without a prior commitment to an activity, we often fall victim to procrastination. Unfortunately, planning for the future doesn’t come naturally – putting something off until tomorrow, on the other hand, does.

Precommitment is a strategy to ensure we reach the goals we set out for ourselves. It is employed by various businesses to ensure customers and clients follow through on their word; for example, you are asked to sign a lease prior to moving into a new apartment to hold you accountable to that decision.¹ It’s unlikely you would back out of your lease after signing it, just as would be less likely to avoid the gym after signing a gym membership.

In 1956, American economist Robert H. Strotz published a paper entitled “Myopia and Inconsistency in Dynamic Utility Maximization.”³ Strotz sought to understand why people were inconsistent in their economic behavior. While someone might choose a “plan of consumption for a future period of time” (165)3 , most commonly in the form of a budget, people do not often obey the plans or budgets they set out. Strotz suggested that if people were aware of their inconsistent consumer behavior, they may precommit by excluding future options. For example, they might hire a financial advisor who will take care of their long-term investing which will disable them from spending that money elsewhere.³ Strotz concluded that precommitment could help people be more responsible with their money.

Almost simultaneously, Thomas Schelling, who won the 2005 Nobel Prize in Economics, began to develop his own ideas about precommitment.⁴ Schelling’s area of expertise is game theory, which explores interaction between two different parties who are assumed to be adhering to the same rules of rationality. Schelling suggested that someone might be better off if their choices are limited in advance. When there are fewer options available, the ones that are left become more credible.⁴

Schelling was developing his ideas on precommitment while attempting to ensure that the Cold War did not escalate. He developed his ideas from an initial 1956 paper into what would become his well-known book, The Strategy of Conflict, in 1960.⁴ Precommitment, he theorized, could help nations limit their options for attack and retaliation, which would guide them to employ the ones remaining. For example, if the U.S. passed a law stating that they would defend Taiwan if it attacked, the law would ensure a national commitment regardless of changing administrations. While the U.S.’s options for action would become limited, their precommitment would also make other nations less likely to attack Taiwan.⁵

In the 1980s, Schelling began to apply these same ideas to help people achieve their personal goals. He suggested that the reason people fail to complete the goals they set for themselves is because of a ‘split personality’ from which we all suffer. Half of ourselves want to go to the gym regularly, but the other half can’t resist that bag of chips. Both of these selves are valid and serious about pursuing their desires, but they don’t exist at the same time. If we could accurately predict that later on, we would want to go to the gym but lack the motivation , we would probably go now rather than later.⁵ However, because of the projection bias, we overestimate how much our future desires will match our current desires, and we therefore only stick to desires that exist in the moment. A bag of chips gives us immediate gratification, whereas it might take us a few weeks to see results at the gym, which makes us likely to focus on fulfilling the action that will give us an immediate reward.

Although Strotz and Schelling contributed their ideas about precommitment, it wasn’t until Jon Elster, a social and political theorist, wrote his 1979 paper “Ulysses and the Sirens: A theory of imperfect rationality” that a formal theory of precommitment was developed.⁶ Based on an understanding of human behavior acting in accordance to bounded rationality, which takes into account factors like emotions, time constraints and available knowledge, Elster suggested that people could use precommitment to overcome their imperfect rationality. For Elster, precommitting was to bind oneself to a course of action: “to bind oneself is to carry out a certain decision at time t1 in order to increase the probability of another decision being carried out at time t2” (470).⁶ An important part of this formula was knowing that one’s future probability of carrying out the action was likely to differ from the current one in an unpredictable way.

Even with the best intentions, we often fall short of completing our goals and bringing our visions to reality. When we consider all the cognitive biases that contribute to our inability to follow through, it becomes vitally important that we develop strategies to ensure we stay on track. Procrastination is the enemy of productivity, and precommitment might be the cure.

Thanks to the commitment bias, which stipulates that we tend to remain committed to our past behaviors regardless of how we feel in the moment, deciding to precommit to a particular behavior is likely to keep us binded to our resolutions even when our motivation wanes. As humans, we find comfort in consistency, which enables precommitment strategies to help guide us towards achieving long-term goals. Precommitment can therefore help with resolutions many of us struggle with, such as losing weight, spending less, or studying more.

What Schelling began to realize back in the 1960s is that people fail to act because of choice overload. The more options we have available to us, the harder it is for us to make a decision. This is also known as the paradox of choice. Precommitment can help us overcome these biases, because committing to a particular course of action, and burning the bridges for other ones, propels us to act on our decisions. Elster wrote, “an action is the outcome of a choice with constraints,” which suggests that precommitment is vital for action.⁶

Sometimes, precommitment can actually have negative impacts on our behavior. While precommitment to a grocery delivery service might prevent you from spending more money on takeout, precommitment to a particular plan can make you lose out on other, sometimes better, opportunities. The commitment bias means that we tend to stick to behaviors we’ve committed to in the past, even if they no longer align with our updated preferences and desires, or begin to lead to negative outcomes.

For example, if you initially thought that being a productive student meant staying at the library until midnight every night until your final exams in four weeks, you might be surprised to realize after the first week that you are exhausted and not retaining any information. Instead of listening to your present needs, the commitment bias and your desire to save face (especially if you told other people about your plan) might cause you to stick to our non-beneficial behavior.

Moreover, the sunk-cost fallacy couples with precommitment, causing us to prioritize a reasonable justification of the past over our present needs. The fallacy maintains that if we’ve already committed time, money or resources into an endeavor, we tend to stick with it because we don’t want that money or time to have been a waste. If you buy a spin class for a particular date, hoping the commitment will ensure your attendance, but on that day you end up feeling really sick, you’re likely to still go to the spin class even though that probably isn’t the best idea for your health. On a more long-term scale, a person might finally receive a career position they’d been hoping for, only to realize it no longer matches up with their current needs or desires. In fact, they are likely to stick the experience out regardless, in the name of justifying their time spent getting there.

Additionally, whether precommitment leads to positive or negative outcomes, there is some controversy over its effectiveness. In one study summarized on TDL’s website, researchers Dennis Hummel and Alexander Maedche found that precommitment was the least effective form of nudging.⁷ Nudges are choice architecture elements designed to guide people toward  a particular decision. Evidently, however, having them pre-commit does not reliably ensure their follow-through.

Precommitment and Gambling

Gambling can be addictive, whether you are winning or losing money. According to the hot-hand fallacy, if you are on a winning streak, you might continue to bet money, falsely believing your good luck will continue. According to loss aversion, if you have lost money, you will try to recuperate your losses by betting more.

Slot machines and other electronic gaming devices, which enable rapid continuous play, make us especially susceptible to addictive betting. They tend to be one of the most common reasons gamblers seek help. As a result, some governments have begun to consider implementing different strategies to prevent people from overdoing it.⁸

Prior to gambling, our headspace is very different than after we start making bets. When making bets, we tend to lose track of time, experience high levels of arousal, and have difficulty stopping even when we intend to. Precommitment understands that more rational decisions can be made when someone isn’t aroused or emotional. As a result, precommitment strategies for electronic gaming devices can force players to decide on a time and money limit before they begin betting, which will enable them to avoid the influences of later mental states.

Different models of precommitment strategies have been trialed in different parts of the world including Norway, Canada and Australia.⁸ Full precommitment models require a player to use a smart card with a particular amount of money that cannot be reloaded and will not work on any machine after a specified total has been reached. Partial precommitment models use the same cards, but instead of disabling them from continuing to play, they simply allow the player to monitor their levels of use more easily. Additionally, either full or partial models can be mandatory or voluntary.⁸

Researchers that studied the effects of these precommitment strategies found that 70% of the users of some kind of model gambled more responsibly, which suggests it is an effective strategy to curb gambling addictions.⁸

Promoting Health Through Technology

Most of us care a great deal about our health. Yet, once our parents stopped booking our dentist and doctor’s appointments for us, it became a lot harder to motivate ourselves to go. Even if we make it to the doctor – for a sore back, for example – and the doctor gives us stretches to do daily, we won’t necessarily follow through on his plan of treatment. Once back home, we might do the stretches for a day or two but end up losing motivation. Since ensuring we maintain good health is incredibly important, how can we ensure we stick to our doctors’ instructions?

Pattern Health is a digital health platform that uses integrated behavioral science and data-driven personalization to improve adherence to treatment plans. The company realizes that the act of physically signing something makes individuals more likely to follow through on what they signed. This is not just a legal matter, but as the company states, “when we sign our names we are also reminding ourselves to follow through on those promises. The signature is hard evidence of the seriousness of our commitment.”¹

The app enables patients to ‘pre-commit’ to their health plan in the form of a signature. After consultation with a physician to determine the best care plan, patients are asked to review their personalized care plan on the app, and then sign it to demonstrate their commitment. Pattern Health believes, based on extensive research, that this action will help people who care about their health actually follow through on taking care of themselves.¹

Precommitment and Procrastination: Behavioral Tools for Students

Even before COVID-19 forced students to attend school online, kids today faced a great deal of potential distractors. Technology has become an essential part of learning, and with it has come a whole new set of attention-suckers. In this article, our writer Johnny Hugill examines how students can avoid the procrastination offered by technology by using precommitment strategies.

This Is Your Brain on Money

It can be really, really difficult to save, despite widespread knowledge of its importance. Cognitive biases mean we don’t always make rational decisions when it comes to money. One reason is friction costs. In this article, our writer Fahima Mohideen explores how precommitment can diminish the effects of friction costs and other barriers to saving.

1. Holzwarth, A. (2018, October 10). The Power of Precommitment. Center for Advanced Hindsight. https://advanced-hindsight.com/blog/the-power-of-precommitment/
2. Goodreads. (n.d.). Nick Winter Quotes (Author of the motivation hacker). Retrieved March 11, 2021, from https://www.goodreads.com/author/quotes/7044387.Nick_Winter
3. Strotz, R. H. (1956). Myopia and inconsistency in dynamic utility maximization. The Review of Economic Studies, 23(3), 165. https://doi.org/10.2307/2295722
4. The Library of Economics and Liberty. (n.d.). Thomas Schelling. Retrieved March 11, 2021, from https://www.econlib.org/library/Enc/bios/Schelling.html
5. Postrel, V. (2005, December 29). A Nobel Winner Can Help You Keep Your Resolutions. The New York Times. https://www.nytimes.com/2005/12/29/business/a-nobel-winner-can-help-you-keep-your-resolutions.html
6. Elster, J. (1979). Ulysses and the sirens: A theory of imperfect rationality. Social Science Information, 16(5), 469-526. https://doi.org/10.1177/053901847701600501
7. Hummel, D., Maedche, A., & Collett, N. (2020, September 8). How Effective Is Nudging? The Decision Lab. https://thedecisionlab.com/insights/policy/how-effective-is-nudging/
8. Ladouceur, R., Blaszczynski, A., & Lalande, D. R. (2012). Pre-commitment in gambling: A review of the empirical evidence. International Gambling Studies, 12(2), 215-230. https://doi.org/10.1080/14459795.2012.658078