Incentives and Student Learning: A Natural Experiment with Economics Problem Sets

Abstract

More than three decades of intense interest in and scholarship about the determinants of student learning of economics has led to surprisingly few insights about what a typical faculty member can do differently to increase student academic success. Based on data from a natural experiment, we estimate the gains in student cognitive achievement in an introductory economics course due to assigning graded versus non-graded problem sets. We identify statistically significant and meaningful problem set effects for. Graded problem sets raised the average students’ exam performance enough to increase their course GPA by one-third of a letter grade. Hardworking, scholastically below-average students’ receive additional academic achievement. These results offer the typical faculty member strong evidence about a simple way to dramatically improve student learning that they can implement.

Keywords: classroom experiment, homework assignment, student performance

JEL Classification: A22, C93, I21