The Behavioralist Goes to School: Leveraging Behavioral Economics to Improve Educational Performance

49 Pages Posted: 16 Jun 2012 Last revised: 21 Aug 2021

See all articles by Steven D. Levitt

Steven D. Levitt

University of Chicago; National Bureau of Economic Research (NBER); American Bar Foundation

John A. List

University of Chicago - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Susanne Neckermann

affiliation not provided to SSRN

Sally Sadoff

University of California, San Diego (UCSD) - Rady School of Management

Multiple version iconThere are 2 versions of this paper

Date Written: June 2012

Abstract

Research on behavioral economics has established the importance of factors such as reference dependent preferences, hyperbolic discounting, and the value placed on non-financial rewards. To date, these insights have had little impact on the way the educational system operates. Through a series of field experiments involving thousands of primary and secondary school students, we demonstrate the power of behavioral economics to influence educational performance. Several insights emerge. First, we find substantial incentive effects from both financial and non-financial incentives on test scores. Second, we find that non-financial incentives are considerably more cost-effective than financial incentives for younger students, but were less effective with older students. Third, and perhaps most importantly, consistent with hyperbolic discounting, all motivating power of the incentives vanishes when rewards are handed out with a delay. Since the rewards to educational investment virtually always come with a delay, our results suggest that the current set of incentives may lead to underinvestment. Fourth, in stark contrast to previous laboratory experiments, we do not see an increased response of effort when rewards are framed as losses. Our findings imply that in the absence of immediate incentives, many students put forth low effort on standardized tests, which may create biases in measures of student ability, teacher value added, school quality, and achievement gaps.

Suggested Citation

Levitt, Steven D. and List, John A. and Neckermann, Susanne and Sadoff, Sally, The Behavioralist Goes to School: Leveraging Behavioral Economics to Improve Educational Performance (June 2012). Available at SSRN: https://ssrn.com/abstract=2085152

Steven D. Levitt (Contact Author)

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American Bar Foundation

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John A. List

University of Chicago - Department of Economics ( email )

1126 East 59th Street
Chicago, IL 60637
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

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Germany

Susanne Neckermann

affiliation not provided to SSRN ( email )

Sally Sadoff

University of California, San Diego (UCSD) - Rady School of Management ( email )

9500 Gilman Drive
Rady School of Management
La Jolla, CA 92093
United States

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