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Incorporating Incentives

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Incorporating Incentives and Behavioral Economics in the Workplace
“Overeating, sedentary behavior and smoking cost employers billions of dollars in health care expenses and lost productivity each year. These behaviors not only contribute to preventable chronic diseases, but also increase the likeness of an early death; as well as create an enormous economic and emotional toll on employees and their families. Behavioral economics offers employers tools to reverse this trend and increase employees’ engagement in their health and well-being. This relatively new subfield of economics integrates economic science with the findings of psychological research to explain decision making and positively influence behavior.” (Wood, 2011) Behavioral economics …show more content…

Communication is a huge element going back to the topic of enabling change—for example, there must be communication about the change and clarity about any decisions that employees need or are wanted to be made. The purpose of behavioral economics is to create an environment that will make the healthy choice the default choice; or better yet, the choice of least resistance. Take for instance in this example, “One hospital required health care workers to receive a seasonal flu shot as the default, unless they signed an extra form to opt out of the vaccine. The default opt-out option for flu vaccination boosted vaccination rates among the hospital’s health workers from the national average of 40% to 98%. (Schnirring, 2011) This example helps to give a better understanding as to why default options are of importance. Another example of the application of behavioral economics in the workplace and making the healthy choice the “easier” choice is, eliminating the “typical” vending machine food options consisting of candy bars, donuts, pop, etc. and replace them with healthy food options such as fresh fruit, water stations, etc. The placement of these healthy choices is also very significant—for example, placing healthy food choices at eye level has proven to be selected more often than if they were out of view; this follows the “out of sight, out of mind” concept. …show more content…

It is more like a school of thought or a style of modeling, which should lose special semantic status when it is widely taught and used. The hope for the future is that behavioral economics models will gradually replace simplified models based on stricter rationality, as the behavioral models prove to be tractable and useful in explaining anomalies and making surprising predictions.” (Camerer, 2002) As mentioned throughout this paper—the use of incentives, as well as behavioral economics is extremely significant. Behavioral economics not only helps to make improvements in the workplace, but more importantly improvements for the individual outside the workplace as well. Ultimately it is our job as wellness professionals to educate and promote the healthy way of life to all individuals regardless of age, gender, sex, etc. Although we may not be able to directly change the health of our nation, we can make a powerful impact. This impact will ultimately result in positive outcomes which is what wellness professionals, like myself are passionate

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