Car Disabler

An interesting twist on Vison and Incentives reported in the WSJ, March 25, 2009, p. D1. Some auto dealers have been installating "disablers" in the cars they sell and finance. If a customer is late on a loan payment, the disabler notifies the customer and counts down the days until the car will be automatically disabled. Car lot owners indicate it works so well that customers rarely miss payments. The loss of mobility is a strong incentive (punishment).