Applying Behavioral Economics to Weight-Loss Why Dieters Fail?

1. Applying Behavioral Economics to Weight-LossWhy Dieters Fail? Shahram Heshmat Department of Public Health; University of Illinois at Springfield (UIS), Springfield, IL Corresponding author: Tel: 217-206-7878, Fax: 217-206-7807 E-mail address: Heshmat.Shahram@uis.edu The Second National Predictive Modeling Summit September 22 – 23, 2008 Washington,

2. Issues • The 21st century will be the Century of behavior change. Changing everyday, long-term behavior is the key to adding years and quality to our lives -Wansink (2006) • There exist mountains of very good science about what constitutes a healthy lifestyle, but still our leading cause of death is I’ll Do It Starting Tomorrow – people continuing to eat poorly, smoke, not exercise, drink in excess. - Robert Sapolsky

3. Research Questions • Why is it that people who are able to successfully initiate changes in their behavior have difficulty maintaining it over time? • How to overcome the problem that individuals are not always able to maximize their own well-being?

4. Purpose • To present some insights from behavioral economics to explain why people fail to maintain healthy behavior. This is accomplished by looking at conditions in which the decision making is impaired or even breaks down. • Knowing why people fail to maintain a desired preference for healthy behavior over time is an essential ingredient in the development of effective weight-loss management. • To draw implications for obesity prevention.

5. Trends

6. Obesity prevalence: United States, 2005–2006

7. Obesity across countries: Percentage of population aged 15 and over, with a BMI greater 30 (2003). Source: OECD Fact book 2005.

8. Causes of Obesity • Within the past several decades, five developments have tipped the balance between caloric intake and expense to an unfavorable equilibrium: • Expanding labor market opportunities for women • Increased consumption of food away from home • Rising costs of healthy foods relative to unhealthy foods • Growing quantity of caloric intake with declining overall food prices • Decreased requirements of occupational and environmental physical activity

9. Poverty and obesity • The Engel’s law: consuming energy-dense foods (e.g., doughnuts, potato chips), and energy-dense diets, is an important strategy used by low-income consumers to stretch the food budget • Energy-dense foods carry a lower price tag, which allows for a higher energy consumption at a lower cost. E.g., a dollar buys 1,200 calories in the form of a package of cookies (Chips Ahoy!), but only 250 calories in that of a bag of carrots.

10. The health risks of obesity • Overweight and obesity have become to diabetes what tobacco is to lung cancer. • Roughly 60% of all cases of diabetes can be directly attributed to weight gain. • Obese adults have about 10 times the risk of developing diabetes compared with normal-weight adults. • The health care costs attributed to overweight is over $100 billion per year – or 9.1% of the country’s health expenditure.

11. How do we evaluate the rise in body weight, and the harm to people’s health? • It is a choice to be fat: the person actually prefers eating more and being fat to eating less and being thinner. • He can’t help what he is doing.

12. Standard Model of Economic Choice • The objective is to maximize utility [U = f (X, W)], subject to a money income constraint and a time constraint. • We act consistently - A good decision is to choose and pursue an outcome that is liked best when it is gained, from among all available options. • Revealed preference • Opportunity set (e.g., a large number of TV channels increase life satisfaction)

13. The rational choice theory has only two concepts to explain the obesity epidemic: 1) overweight individuals have poor health and nutrition information, 2) they actually prefers eating more and being fat to eating less and being thinner. • In the first case, all we can say is that overweight individuals are making mistake, in the second case, they don’t value their health. • Overweight and happiness • Behavioral economics, on the other hand, assumes that people are susceptible to temptations and they tend to pursue immediate gratification in way that they themselves do not appreciate in the long run.

14. What is behavioral Economics? • The field of behavioral economics blends insights of psychology and economics. It uses insights from psychology to develop more “realistic” models of individual decision-making, in which people often do things that are not in their best interests. • Behavioral economics explains why people appear so inconsistent when their behavior is viewed through the lens of the standard economic model.

15. Choice over time • A key concept in behavioral economics is that of how delayed rewards are discounted by individuals, and deviation from the rational-choice paradigm. • Discounting of delayed rewards refers to the observation that the value of a delayed rewards is discounted (reduced in value or considered to be worth less) compared to the value of an immediate rewards. Higher discount rates give greater weight to benefits and costs accruing early in the life cycle than do lower discount rates.

16. The Seductive Present-Moment • Insights from behavioral economics indicate that people are often of two minds when it comes to intertemporal choice - they are often powerfully motivated to take myopic actions, such as eating highly caloric foods, while recognizing simultaneously that these activities are not in their self-interest. • Such preferences imply that people have self-control problems wherein they are unable on a moment-by-moment basis to behave in their own long-term best interest.

17. An Example: Option A: Starting an exercise program today • Costt0 = 8, Valuet1 = 10 => net gain = 2; net gain (discounted @ 50%) = -8 +1/2(10) = -3 • So we are reluctant to start exercising today. Option B: Starting tomorrow: • Costt1 = 8, Valuet1 = 10 => net gain (time adjusted) = -8 (1/2) +1/2(10) = 1 • Hence, everyone is enthusiastic about going to the gym tomorrow.

20. Preference reversal • A surge of preference for the less valued alternative when it looms close. • Indulge now and abstain tomorrow: the long-term motivation is constantly threatened by short-term motives • We are strangers to ourselves

21. Summary • In sum, individuals display behavior that is dynamically inconsistent. Initially people prefer X to Y, but they later choose Y over X. How can such behavior be understood? What is about the immediacy of an event that blinds us to better alternatives that we might have if we could only wait a little for them?

22. Self-control problem

23. The Mechanisms of Preference Reversal • The Duplex Mind: Impulsive vs. Reflective Decision-Making • Asymmetric warfare between emotion and cognition • Our emotional brain has a hard time imagining the future, even though our logical brain clearly sees the future consequences of our current actions.

24. Affective and Deliberating Processing

25. The Primacy of Emotion

27. Willpower • Willpower is an important ingredient in self-control. • Self-control functions like a muscle that can be depleted with use but strengthened over time.

28. Dieting as a choice over time • Dieting is a popular means of weight control. It is estimated that 24% of men and 38% of women in the US are trying to lose weight. • The two principal reasons given by dieters for wanting to lose weight: health and attractiveness • Dieting behavior can be viewed as making constant trade-offs between immediate and delayed benefits under uncertain conditions (“a moment on the lips, a lifetime on the hips,”) • This difference in the timing of costs and benefits constitutes one of the major obstacles to dieting. Food brings immediate gratification, while the health costs of overconsumption occur only in the future. As every dieters know, it is one thing to plan for meeting caloric restrictions, but quite another to maintain it.

29. Why Dieters Fail? • Visceral feelings: Hunger, Stress • Cue-Elicited Behavior • Attentional Bias • Willpower (Ego Depletion) • Hot-cold empathy gap: underestimate the power of craving • “What the hell” effect • Alcohol myopia • Social Influence • Awareness of self –control problem

30. Explaining Overweight in Modern Society

31. Overweight in modern society • The role of stress (e.g., increased demand on women at home and on the job) • Homeostatic vs. Hedonic hunger (wanting) • Wanting (choice) and Liking (hedonic reaction) are separable systems • Transient irrational wanting comes and goes with the cues. • Wanting system seems more sensitive to the widespread availability of highly palatable food, which creates hedonic hunger (“perceived deprivation”) • The permissive social norm to eat any time of the day, and however one wants

32. Resisting Temptations

33. Self-Control Strategies • Cue management • Eliminating options • Imposing cost • Setting up rewards contingent on the choosing delayed reward • Delays & cooling off period • Automatic self-regulation (IfDo rules)

34. Policy Implications • The competing brain region implies developing new prevention approaches to influence the relative control of these two brain regions: (1) decrease activation of impulsive brain regions and (2) increase activity in executive brain regions. • The role for “cognitive” policies, including the suppression of certain environmental cues. • Paternalistic policies: Because such present-biased people may not behave in their own long-run best interests, there is a role for policymakers to create incentives that will motivate individuals to maintain a pattern of behavior.

35. Conclusion • People devalue a given future event at different rates, depending on how far away it is. • People do not act in their long-term self-interest – they impose a cost on future selves • Consistency (rationality) is not costless: requires effort & investment • The cost vary among individuals by the amount of limited willpower

36. Thank You