Limits on Regret as a Tool for Incentive Design

Felipe A. Araujo, Alex Imas and Alistair J. Wilson

Journal of Political Economy Microeconomics, 2026, vol. 4, issue 1, 78 - 105

Abstract: We demonstrate the pitfalls of extrapolating behavioral findings across different contexts and decision environments. We study regret theory and the use of “regret lotteries” for motivating behavior change. Here, findings from one-shot settings have been used to promote regret as a tool to boost incentives in recurrent decisions across many settings. Using theory and lab experiments, we find weak evidence for regret as the superior one-shot incentive; critically, for repeated decisions the comparative static is entirely reversed. Moreover, all effects are extremely sensitive to details of regret implementation. Our results imply caution when designing incentive schemes that exploit regret.

Date: 2026
References: Add references at CitEc
Citations:

Downloads: (external link)
http://dx.doi.org/10.1086/734143 (application/pdf)
http://dx.doi.org/10.1086/734143 (text/html)
Access to the online full text or PDF requires a subscription.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ucp:jpemic:doi:10.1086/734143

Access Statistics for this article

More articles in Journal of Political Economy Microeconomics from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().