How can game theory help us to embrace good habits?

Game theory can be an excellent tool for changing habits because it provides a framework for understanding strategic decision-making and interactions between individuals or different parts of ourselves (if we apply it to personal behavior). By analyzing habit formation through a game-theoretical lens, you can create strategies that maximize your chances of successfully changing habits. 

Here’s how:

1. Identifying Players (Self vs. Self)

Game theory models the interaction between two or more players. Thus, in habit change, think of yourself as two players: your current self and your future self. Both have competing interests: the current self wants immediate gratification (e.g., staying in bed, eating unhealthy food, not doing any physical exercises), while the future self is focused on long-term benefits (e.g., waking up early, maintaining health, training).

Game theory insight: This conflict is similar to the Prisoner's Dilemma (post about it in the link), where cooperation between your present and future self can lead to better outcomes. The goal is to align the interests of both selves so that they cooperate rather than defect.

Strategy: Identify actions that satisfy both selves, like introducing small, immediate rewards for behaviors that benefit the future self.

2. Incentive Structures

Change your environment to adjust the incentives that shape your behavior. The decisions in your daily routine are influenced by both external and internal rewards and punishments.

Game theory insight: Use a Tit-for-Tat strategy, where you reward yourself for positive actions and “punish” yourself (with something small) for negative actions. If you skip a workout, you might add extra exercise the next day or remove a privilege like watching TV that evening.

Example Application:

• Positive Action: If you complete a daily goal (e.g., 30 minutes of exercise), reward yourself with something like watching an extra episode of your favorite show.
• Negative Action: If you skip the task, "punish" yourself by delaying something you enjoy (e.g., no dessert after dinner).

Strategy: Redesign your incentives by making the benefits of good habits more immediate (e.g., tracking progress visibly and getting instant feedback). Also, remove temptations or make the cost of bad habits more apparent.

3. Commitment Devices

A key part of game theory involves committing to certain strategies. In personal habit formation, this can mean using commitment devices that "lock in" your future decisions, reducing the temptation to deviate.

Game theory insight: Commitment devices like financial penalties, public commitments, or setting up automatic behaviors (like automated savings or fitness reminders) prevent your current self from sabotaging future goals.

Strategy: Use a commitment device to bind your future actions, like signing up for a marathon, automating savings, or using apps that penalize you for failing to meet goals.

4. Nash Equilibrium (Balancing Strategies)

The concept of a Nash equilibrium refers to a situation where no player has an incentive to change their strategy given what the other player is doing. For habit change, your long-term success comes when both your present and future self find a balance between immediate gratification and long-term benefit.

Game theory insight: Establish routines or environments where the cost of deviating from a habit is high, and the reward for maintaining it is consistent. For instance, if you want to quit smoking, surround yourself with non-smokers and avoid places where you used to smoke.

Strategy: Find a balance that allows both your immediate and future needs to be met with minimal friction. This could mean finding enjoyable ways to exercise or eat healthy, so that your immediate desires don’t feel deprived.

5. Repeated Games and Reinforcement

Habit change isn’t a one-time event but rather a repeated game played every day. Each decision builds upon the last, so the cumulative effect of small choices can be powerful.

Game theory insight: In repeated games, cooperation often emerges because players recognize that their actions today affect tomorrow. Apply this to habits by acknowledging that one good choice today makes it easier to make a good choice tomorrow.

Strategy: Focus on creating momentum. Start with small wins and reinforce them, so that each day your brain receives positive reinforcement for sticking to your new habit.

By using game theory principles, you can better strategize and design environments that support lasting behavior change. Which of these strategies resonates the most with the habits you're trying to change?

The pictures in this post were taken from Unsplash.

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