Economic incentives are ubiquitous, whether at work or at school. Economic incentives are when people are encouraged to act in a certain manner through rewards, which can take the form of money, goods or even services. People are influenced by rewards offered to them therefore economists try to devise clever schemes to nudge people towards specific, desirable actions. Here are some economic incentives we found particularly interesting.
In Dubai, the government created a new, innovative way to reduce obesity in the population. The government's new scheme offered people gold if they lost weight; the amount of grams in gold offered to someone depended on the amount of kilograms that the individual lost before the end of Ramadan. The person who lost the most weight also won a gold coin worth around $6,000.
In Singapore, the government needed to find a way to increase their dwindling population. The solution? Offer free trips for newlyweds to Bali to increase birth rates. The jury is still out on whether it has been a success.
In Haifa, Israel most daycares close at 4 pm, and parents are expected, out of their own generosity, to pick up their child on time. For the majority of cases, parents came on time and were rarely ever late. One day care, however, tried imposing a financial penalty for tardiness - an economic disincentive. As a result, more parents starting picking up their child late since they preferred to just pay the fine. It seems like sometimes people don't always need money to act.