Economics and New Year’s Resolutions

In recent days, we’ve introduced a pair of regular guest bloggers, Ian Ayres and Sudhir Venkatesh. We are happy and proud to now introduce a third, a terrific addition and no stranger to readers of this blog: Justin Wolfers, an economist at Wharton and a great explorer of everything from racial bias in N.B.A. refereeing to the decline in women’s happiness to divorce myths.

With the holidays upon us, it’s hard not to turn the economists’ gaze to the rituals around us. So let me ask, what exactly are New Year’s resolutions about? Here are seven theories, collected around my Christmas Eve table:

1. Aspirations: a statement (to self; to others?) of who and what I want to be. New Year’s Eve is simply a focal point for this statement of aspirations.

2. Commitments to self (or my future self): a statement of what I want to be. And if I don’t achieve it, I will be left with the guilt of not having lived up to a promise to myself. If that is costly enough, then the commitment may be useful.

3. Commitments to others: many of us describe our commitments to our friends. Henceforth, it is their job to hold us to it, or else to make us feel bad. Describing my commitment to my friends is like posting a bond, based on my future good behavior. (And perhaps this is a less costly commitment than betting at Stickk.com).

4. A clean slate: we rarely respect the irrelevance of sunk costs in our behavior. The New Year is a clean slate. If my behavior is history dependent (why not eat the chocolate cake if I’m already overweight?), then the clean slate allows my behavior to escape past poor behavior.

5. A signal: I only get to make a small number of resolutions, and so making a resolution about fitness is credible, relative to the fact that I chose not to make a resolution about tardiness. (In this sense, it is like the A.E.A. signaling system, where aspiring assistant professors can make a New Year’s resolution that they really, really would like to work at two specific universities.) Perhaps related to Nos. 2 or 3.

6. Intertemporal reallocation: diets in January follow gluttony in December. Or hard work in January follows slacker time in December. And this is more efficient than forgoing all that terrific food/all those wonderful celebrations/all that time off in December. By this theory, it isn’t surprising that so many resolutions are about health/diet/fitness, and it isn’t any concern that we rarely respect these resolutions past February.

7. Cheap Talk: New Year’s resolutions are simply hot air, stated at around 11:55 pm, on a night involving plenty of alcohol. They are rarely respected, and there is no way for them to be enforced. They are a ritual, but not more important than kissing a loved one 5 minutes later.

Beyond theory, what about empirics? Let me report the results of an informal poll around our holiday table: none of the men (out of 3) and 2 of the women (out of 4) typically make New Year’s resolutions, and only one person actually expects to keep her resolutions. Is this typical?

Do you make New Year’s resolutions? Why or why not? Comments are open.


RK

If it's time to make a change, why wait till Jan. 1st to do it?

That's all.

Leslie

I think that New Year's resolutions are just a way of taking stock and evaluating your life. Where are you now? Where would you like to be in a year? It's very similar to what the New York Times and lots of other publications do at the end of the year. The new year is a reminder to look back over the past and into the future at the same moment. And the endearing thing is that we are all so hopeful that we will do better.

Meridian

Interesting thought about the irrelevance of sunk costs in deciding about our future behavior.

But can we get others to go along? Aren't we prisoners of our resumes -- professional and otherwise?

Marley's ghost didn't carry around those chains for nothing.

Armand

Discussing New Year's resolutions in the context of beginning a new calendar year misses the point. More appropriately, they should be called Post-Holidays Recovery Resolutions (PHRR's), since they come following a month or so of stress, forced overindulgence, multiple parties with too much food and alcohol and general physical and mental exhaustion (exacerbated by the aforementioned food and alcohol overindulgence). Did I mention people continually pushing cookies,cakes and drinks at you? Yes, we're each responsible for how we handle all this, but how many of us maintain calorie disipline in the face of all this? My New Year's resolutions boil down to trying to get back to living a normal life. Which, of course, is not as healthy as it should be, anyway.

joan

i dont need to make any changes. i am perfect . everything is just the way i want it.

LJAnderson

I always make New Year's Resolutions--why not have one time of year (birthday can work as well) that you self examine and at least try to become the person you want to be. The problem, of course, is making the resoultions last. I have been successful in changing several behaviors I believed to be less than positive--e.g., once I resolved not to exaggerate stories I tell, but to always tell the absolute truth, and I've kept this one, making me a better person, at least in my eyes. Thus--why not at least try--certainly we could all be better and be the better we ascribe to. Good luck and Happy New Year!

Susie

I teach, so I always consider the new year when school starts up after the summer vacation. I make a "resolution" of what I can improve in my classroom and then a few personal ones to go with it. Last year my personal goal was to floss more... and now it's gone from being a chore to a habit. This year I'm working on changing my lifestyle so I am more active. I joined the local Y in August and have been going. New Year's for me is just checking in to see how I'm doing with these goals.

I agree with the people who post "why wait till January" but at the same time, it's the reflection on yourself that prompts the internal change. For me that happens over summer vacation. For others over their winter break, or the end of the official year. I don't think they should be looked down on for "waiting" till January, but celebrated for making the change in their lives that will make them happier, healthier and a better person.

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bb

Wow, no one that reads the New York Times makes New Years resolutions, apparently because they're all far too smart and together for that sort of thing. I don't have life totally figured out yet, so I use the beginning of the year a good time to re evaluate my life and make a commitment to try and change some things.

Leigh

As Opus says, economists do enjoy messing with issues that others have thought much more deeply about. But in this case it has everything to do with economics, because resolutions are about allocating scarce resources (like effort) to improve one's life. DD chalks it up to hyperbolic discounting, but that's not an explanation of behavior, just a description. Self-control theory (developed jointly by psychologists and economists) is a better example of a way to explain resolutions.

AB

It seems that most of the readers (or just the commentators) of this blog are self-critical, rationalist types who look down on those who take Jan. 1st to be a day of any particular significance.

Coincidence?

Minushka

I love the New Year's round-up I do every year. It actually doesn't include resolutions; it's more of a looking back over the past year, seeing what worked well for me and what didn't.

I write answers to a series of questions, such as: what I'm happiest about at this moment in my life, what I'm most worried about, which recent purchases were worth buying and which weren't, what my current hopes/projects are, what I'm most grateful for, etc. The questions vary every year, depending on what's on my mind, but I always decide (for fun) what are my current favorite books, music, movies, and colors. (Not necessarily the best new stuff of that year, but what I'm into at that moment.)

I don't make specific promises for the next year, but there's a sort of unfocused hope that by being more aware of what worked in the past, I will be able to make better choices in the future. Mostly, I do this because I like to. This is how I examine my life.

Why New Year's? Because the date is a trigger, reminding me to do this round-up annually. Otherwise I wouldn't do it so regularly. Because everyone else is making resolutions (or discussing why they don't) or writing Top 10 lists, and this is my version.

P.S. For those who were wondering: my top favorite colors never change, but my secondary favorites do, often following what's currently in fashion.

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Joe Paris

Of COURSE I make New Year's Resolutions !!!

And, as all such fun (like astrology, seeing a psychologist, and choosing someone to pick stocks for you), they are "For Entertainment Purposes Only" !

Lighten up America ! Why NOT indulge in some fun around New Year's, what with all of the recriminations out there concerning what you did NOT get accomplished in 2007 !?

My grandmother Lillian had the right spirit: Choose and then Phrase your Resolutions in such a fun way that you get BIG BELLY LAUGHS from all who hear them !

My most-adhered-to New Year's Resolution, which I have faithfully kept for more than half a century now (I am 56 and started with this fine tradition when I was 6), is this:

ALWAYS MAKE A HUGE NUMBER of New Year's Resolutions, the more outrageous the better, that way, what you may lack in quality, you MORE than make up for in VOLUME !!!

_ Joe Paris

Vanessa

The celtic calendar starts Nov 1. I make Halloween resolutions.

Sofia

Rules and resolutions, regardless of the time of year, are important for structure, health and progress. While it is true that 50% of the time we end up breaking/not living up to them, it is for precisely this reason - the fear and knowledge that it might not work out, that gives us a kick in the butt to make it work out.

EbenezerSeattle

When you're in the middle of a hectic life, it often takes some prodding to step back and reassess your life. New Year's is one event that prods people into action. As Kevin @14 says, if it works for you, do it.

The reason resolutions don't work for many (me included) is that to happen, it has to have a strategy behind it. That means time and realistic planning, then monitoring and adjusting. It doesn't have to mean Gant charts, but it may. Expecting a resolution to come true without designing a plan to make it happen is about as realistic as going out for one run and then expecting to be in shape.

Instead of the annual articles about if New Year's resolutions are a good idea, why not study the differences between those who keep their resolutions and those who don't? How about some data here instead of speculation?

One way to do that would be to track people monthly, on this blog perhaps, who make a resolution, then see if and how they keep it.

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Anne Y

I would like to suggest a new way of looking at
people and a more enlightened system to live
by. Those are my revolutions!!

Mark Phelan

Saying a resolution usually means nothing for me. Writing down my resolution(s) almost always results.

Gdub

I always forget about making resolutions. This then leads to a hasty, last minute, insincere set of goals which are usually broken by June.

I think I loathe the fact that it's so cliché so I try not to give it though, but in the heat of the moment I always succumb.

aallffrreessccoo

My wife and I don't make resolutions, but after reviewing the year's accomplishments (paying attention to last year's list)at a traditional New Year's Day lunch/supper we list (and save on paper) some goals for the coming year. Many of them are developments attached to previous accomplishments and over the years many of them were accomplished including writing and publishing a book and some scientific papers, five academic degrees (2 bachelors, 2 masters and one Ph.D.), finding, renovating and decorating four run down houses, in addition to gaining academic positions.
We've been doing this for over twenty years. We started based on the conventional New Year's resolution track but it has since become our own tradition.

Farina

New Year's resolutions are da bomb, as far as I am concerned. There is no better to time than the beginning of a new year to dig yourself out of any holes that you may have dug for yourself. (The tabla rasa approach.)
In fact, I started early this year, realizing that it was a necessity. I'm dieting, exercising every day, reading more, and working on giving up smoking. (The Chantix route). That may be my biggest challenge. It's always easier when you have the support of a loving family, which I do. I just wish that my husband would believe me when I tell him that it is imperative to my health. He tends to ignore me, and is somewhat obtuse when it comes to my feelings. It makes it more difficult, but my intentions are true and on the mark. I owe it to myself and to my family to get back on track, and there is no better time than the present. Cheers to the New Year, and a sparkling water to all!

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