Fun With Incentives

Never, ever, think about something else when you should be thinking about the power of incentives.
Charlie Munger

During this past month, I had a lot of fun with, a newsletter that pays its members in Bitcoins for performing tasks — which are typically interesting and will teach you something useful.

Here's the main things I did so far:

My submissions got selected on some of these tasks and I got ~220$ out of those that have been awarded so far. That's less that I could have earned otherwise in the same timespan if I was hell-bent on earning money. But as we'll see below, that's not why I did it.

There are now new tasks to learn about crypto technologies (the Ethereum Name Service and learning the solidity smart contract langauge. I'm excited to do these too.

But I'm actually not writing this to shill 1729. Rather, it's to marvel about the power of incentives.

See — most of these things I enjoyed doing and might have done without the possibility of a monetary compensation. But living is prioritizing (if you're doing it right at least) and besides working out, none of these things were high-priority enough.

But 1729 offered me a collection of incentives to complete the tasks:

To be fair, there was a reason that most of these things were not on my todo list. But the added incentives were enough to put them past the hump. And the way I use my time is far from optimal. Had I not, say, written an article, I might have watched an interesting youtube video instead with no relevance to my daily life. The incentives stir you towards spending your time smarter.

It also got me thinking. If 1729 can incentivize me in this way, can't I do the same to me? I can certainly chunk task in manageable bits, and set deadlines. I can also use the seinfeld method and build on top of a series of small wins. Paying yourself gets more tricky, however. I think I know how to make it work.

The key is that I'm cheap. So there are a few not-so-unresonable expenses that I don't make because they are not strictly necessary or an improvement to my day-to-day life. Now say there's something I want to get done, or a behaviour I want to promote. If I care enough about that, I can justify paying to speed it up. On the other end, I get the reward if I complete the task within the deadline. It's a smart way to get in alignment with yourself.

There's a snag though — what if you don't make the deadline? Do you just put the reward back in play? As the payer this makes sense — you want the thing done after all. But on the other end, this is the wrong lesson: you can slip the deadline but still get the reward (albeit later). I think the key here is to reward yourself for consistency. So if you slip, the previous reward might be out of play for the next task, which will grant a smaller (or more generic) reward. But if you succeed at that one, and at the next one, then you get the original reward. That way, you get the nice rewards only if you keep succeeding consistently.

I will try to experiment with these micro-incentive structures in the near future.