Financial Incentives and Student Achievement: Evidence from Randomized Trials
Roland G. Fryer Jr.
Harvard University - Department of Economics; National Bureau of Economic Research (NBER); American Bar Foundation; University of Chicago
NBER Working Paper No. w15898
This paper describes a series of school-based randomized trials in over 250 urban schools designed to test the impact of financial incentives on student achievement. In stark contrast to simple economic models, our results suggest that student incentives increase achievement when the rewards are given for inputs to the educational production function, but incentives tied to output are not effective. Relative to popular education reforms of the past few decades, student incentives based on inputs produce similar gains in achievement at lower costs. Qualitative data suggest that incentives for inputs may be more effective because students do not know the educational production function, and thus have little clue how to turn their excitement about rewards into achievement. Several other models, including lack of self-control, complementary inputs in production, or the unpredictability of outputs, are also consistent with the experimental data.
Number of Pages in PDF File: 91
Date posted: April 12, 2010