Day Twelve - I can't help it, it's my major

Sean correctly said something pretty remarkable today: "A funny thing. I have a person very close to me who is overweight. We talked about the PCP and he stopped taking as soon as he heard about the amount of money it costs to join. And, of course, when I first talked to Patrick, the price made me think twice too. But, look at me now. And, if I hadn't spent the money on the PCP, I'd be spending the same amount and more, albeit more slowly, on overeating, allergy medication, pneumonia medication and eventually, but much sooner than planned, this: [gravestone]"

Although, he stops short by only listing the monetary costs. If we look at the non-market benefits to the PCP, such as his self-reported increased energy, or improved health for his family (classic example of positive externalities, or spillover effects) then the equation tips even more towards the PCP. These things are notoriously difficult to quantify and place a dollar amount on, so they are often not included in traditional Cost-Benefit Analysis. This is a mistake.

And to be sure, there could plenty of non-market costs to the PCP as well, the increased time in food prep and the time spent exercising. I can't speak for Sean, but I enjoy the workouts so for me that is an additional benefit. As a silly example, it also forces me to drink water first thing in the AM, instead of coffee, which I am sure has some positive health effects.

In the comments Seabass points to an interesting phenomena semi-recently introduced to the literature by behavioral economics, and the rationale behind the web service Stickk. Namely, that if you pay a cost for doing or not doing something, you will be more incentivized to do it. Personally, I think this relates to the CBA discussion above. The monetary costs are fixed, if I drop out of the PCP today they do not change. So, somewhere in my brain, I know I have to get X amount of benefits from the program to match these costs. In the classic "gonna get in shape" example I have similar costs, but they are ongoing. If I quit then both my additional benefits and costs cease. So the optimal decision is less clear and, indeed can change day to day. One morning the "cost" of getting out of bed might not match the marginal benefit of an additional day of jogging around the park. I do that a few times and jogging becomes harder again and as my discomfort on the track increases my costs increase. And then I find myself out of shape again.

E's case is even more extreme because he had very high costs without any discernible benefits, so of course he quit. It was the correct thing to do!

All of this is a long and wonky way of saying that Sean's friend is full of nonsense. But if it were this simple why is it so hard to see? Because even the most naturally risk adverse of us still discounts future gains compared to today. A bird in the hand is worth two in the bush, right? Think about it, the health and fitness benefits of a PCP-style lifestyle change are paid out in the future with all the costs upfront. The benefits of a eating a BLT in front of the TV are paid to me now with the costs in impaired health and fitness way in the future.

Add to that the recursive disincentives that are created by an unhealthy lifestyle: it literally becomes harder to exercise as you get out of shape or the social costs of being the heaviest person at the gym or the guy benching the empty bar. This is where the 12-step language of breaking the cycle comes into play. By having a 90-day intensive experience we are forced to break the self-reinforcing habits that got us into these positions in the first place. Each time we do so the benefits of that BLT are lessoned (just reading the indulgence reports makes that clear) and as discussed earlier with Sean's examples we discover additional benefits that are delivered in the short term. Also, how many PCP'ers learned to love vegetables during the program?

Our internal Cost-Benefit Analysis becomes realigned and the rational, logical, "homo economicus" thing to do is to get up early in the morning and jumprope.

Which, incidentally, is all I did this morning. I walked to a local park for some change of scenery and ended up running out of time after the 700 jumps. Will have to complete the rest of the exercises at home tonight. Patrick, is this a good strategy or should we try and do the work out in one big block until we start the two-a-days?