I think we’ve been over commitment devices before, but let’s recap: Traditional economists assume that individuals are perfectly rational. Being economically “rational,” in part, requires that an individual’s short-term and long-term preferences are always aligned. For example, this would mean that if I decide on Monday that the best option for me on Friday is to stay in and do work, I will still think that this is the best option when Friday rolls around. Economists call this being “time-consistent,” and it probably doesn’t shock you that most people are not always time-consistent.
It’s generally true that a person’s ahead of time choices are more likely to be aligned with his long-term best interests than are those made to satisfy a need for immediate gratification or whatnot, so some self-aware individuals choose to employ what economists call commitment devices. Simply put, commitment devices are the economic version of Ulysses tying himself to the mast to avoid the sirens, and they range from the mundane (Christmas clubs, for example, where people pay to have their money held hostage until the holiday season) to the ridiculous. On the latter front, I previously introduced you to the concept of the time-delay safe:
I didn’t think I would ever top that in terms of potential humor value, but I think I’ve found a strong contender. Allow me to introduce a behavioral economist’s new favorite alarm clock:
This design concept might be more sight gag than real product, but it’s clever nonetheless. Bringing new meaning to the phase “you snooze, you lose,” when you place this unforgiving clock across the room from your bed, if you don’t get up when the alarm sounds, it’s going to cost you.
In case you’re curious, it is in fact illegal to destroy currency on purpose. (The “on purpose” part is important, since it would be sad if people got arrested for the whole bills in the pants in the washing machine situation.) As such, I would like to suggest the following option instead:
(From Amazon) This one may roll around the room and make noise if you try to snooze, but at least it won’t inadvertently lower the money supply.
Alternatively, I think that there is an entrepreneurial opportunity to partner with Stickk.com to develop an alarm clock that would automatically charge people who snooze too much. (Under Stickk contacts, the money charged gets donated to charity.) Not surprisingly, Stickk.com was founded (in part) by Ian Ayres, who is an economics and law professor at Yale. He also wrote a book called Carrots and Sticks that talks about this and similar concepts. He’s also fairly tolerant of my antics: