Should We Reward People for Healthy Living?

A recent New York Times article documented a study in which people were paid by their Fortune 500 employer $10 a visit to workout at a gym for a four week period. Not only did many employees respond to the incentive but a significant portion of them continued to work out regularly for some period after the four weeks of $10 rewards ended. 

That study is only one of many in which both governments and corporations are using various kinds of inducements to encourage individuals to make good decisions for their health and other purposes. Freedom of choice remains with the individual. But certain options, judged to be good ones, are promoted in concrete ways. Policy makers tend to like rewards: they point people in what's judged to be the right direction without commanding them to do anything. Educational campaigns, discussed in my last Post, extol healthier choices. Incentives offer tangible support for them. 

Rewards are being experimented with in several areas other than health. We have long used the tax system to reward certain activities by providing preferential treatment: savings for retirement (RRSPs), for education (RESPs) and housing (no capital gains on principal residences). Another area involves measures to address traffic tie ups. There are "sticks" being used such as "congestion charges": levies imposed for using high traffic areas at peak times etc. But "carrots" are also being experimented with...

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