WHEN two tubby graduate economics students at the Massachusetts Institute of Technology decided to lose some weight, they employed the profit motive to help them succeed. Dean Karlan promised to pay John Romalis $10,000 if he did not lose 38lb (17kg) by an agreed date. Mr Romalis made a similar pledge. If both failed, the one who failed by least would get $5,000. Happily, both succeeded in shedding pounds not dollars, and the initial deal was replaced with a “maintenance contract” which allowed either economist to show up unannounced to check the weight of the other and collect $5,000 for each pound over an agreed weight.
The still slim Mr Karlan went on to launch stickK.com. A really cool site to help people stick to their goals based on the same concept above of signing commitment contracts. Check it out!