Friday, January 27, 2012

Incentive and Emotions

I watched the Freakonomics movie the other day and it got me thinking about incentives. But more than incentives it got me thinking about how in any situation in which you are trying to persuade someone there are incentives but also emotions.

An incentive is a reason, reward or benefit someone gets from taking an action or making a decision. An example of an incentive being used in pick-up is the idea of bottle service. If you have a table and bottles of alcohol women are incentivized to talk to you, or go back to your table by the idea of free alcohol and or being around guys with $$$

But with all due respect to Steven Levitt, the incentive model ignores emotions and how emotions can affect decision making.

If we were all rational like economists predict based on market models than all it would take to motivate any group of people would be the proper incentive. But as we even see in the Freakonomics sometimes incentives fall by the wayside.

In the movie there is a short part where they follow an attempt to incentivize high school freshmen into raising their grades by offering them a small amount of money around $50. They follow two kids one of whom does raise his grades the other falls prey to peer pressure.

The peer pressure in this case is the emotional incentive. In this kid's case, it's more important and valuable to hang out with his friends and skateboard then it is to get that $50. Now obviously if the incentive were higher, he may have been more diligent, but that makes an entirely different point about price point behaviors which is less interesting. The point here was that when faced with a financial incentive or an emotional incentive 50% of the kids went with the emotion. Which basically backs up one of my favorite things I say which is this:

ALL PEOPLE MAKE EMOTIONAL DECISIONS THEN USE LOGIC TO BACK THEM UP AFTER THE FACT!

So how does this relate to pick-up?

Pretty easily. Incentives do matter, so being able to demonstrate how awesome you are and how much a girl will benefit from being around you does matter. But it only matters as much not more than the emotion a girl gets from being around you. You can't just cover one side of the coin and hope to be successful.

Hope that helps,

JS

8 comments:

  1. Anonymous11:09 AM

    I think you are a little off base here. Economists put a price on that incentive. For the kid who didn't increase his grades, the tradeoff was simply not worth it for him. This could be due to many factors, peer pressure being one of them. If they offered him, say $2000, do you think peer pressure and his 'emotional' decision would have won? Probably not.

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  2. Anonymous1:41 PM

    That's exactly correct. Neuroscience shows us that the limbic brain has significantly more influence over behavior than the latest addition, neocortex. Women are demonstrably less 'rationally' oriented brain-structurally. This isn't good or bad, right or wrong, etc. I ignore the majority ov what comes out ov a persons mouth and pay attention to everything else. The limbic brain doesn't lie. Trees are the words, behavior is the forest.

    zer0/po.nt

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  3. Anonymous9:53 PM

    emotional incentives are still incetives, theres just not as tangible. Your not disagreeing with levitt at all, your just saying incentives themselves can be emotional, and not just material (money)

    The idea that someone may want to be hanging around someone else because "they make them feel good about themselves" is huge incentive.

    Its not incentives AND emotions, but rather incentives ARE emotions, you have allouded to this toward the end, but your thesis seperates them

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  4. Anonymous8:03 AM

    "If we were all rational like economists predict based on market models than all it would take to motivate any group of people would be the proper incentive"

    - How about behavioral economics?

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  5. lightsweetcrude6:46 PM

    The emotional response you describe might be compared to Behavior Finance. I'm still wading through "Thinking Fast and Slow" by Kahneman -- his System 1 and System 2 mechanism is interesting.

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  6. Anonymous12:01 PM

    Another reminder that reading The Red Queen won't get you laid.

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  7. Anonymous1:28 PM

    economists are often too narrow in their view of humanity. ludwig von mises developed a wider more inclusive view called praxeology.

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  8. Anonymous11:56 AM

    "the incentive model ignores emotions and how emotions can affect decision making."
    Only if one looks at incentives deterministically, which no intelligent person would. Any kind of an incentive is one of many factors that affect a decision, not a sole motivating factor.

    "If we were all rational like economists predict based on market models than all it would take to motivate any group of people would be the proper incentive."
    Behavioral economics (as well as psychology in general) has proven beyond a doubt that we are NOT all rational beings. The idea that humans make rational choices based on complete information is an ideal that originates hundreds of years ago, and is just as lacking in reality as the idea of the noble savage.

    You are correct, though, in that a common human tendency is to attempt to rationalize our feelings.

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