Incentive Design in Education: An Empirical Analysis

56 Pages Posted: 4 Jan 2016 Last revised: 31 Aug 2022

See all articles by Hugh Macartney

Hugh Macartney

Duke University - Department of Economics

Robert McMillan

University of Toronto - Department of Economics

Uros Petronijevic

New York University (NYU) - Department of Economics

Date Written: December 2015

Abstract

While incentive schemes to elicit greater effort in organizations are widespread, the incentive strength-effort mapping is difficult to ascertain in practice, hindering incentive design. We propose a new semi-parametric method for uncovering this relationship in an education context, using exogenous incentive variation and rich administrative data. The estimated effort response forms the basis of a counterfactual approach tracing the effects of various accountability systems on the full distribution of scores. We show higher average performance comes with greater score dispersion for a given accountability scheme, and that incentive designs not yet enacted can improve performance further, relevant to education reform.

Suggested Citation

Macartney, Hugh and McMillan, Robert and Petronijevic, Uros, Incentive Design in Education: An Empirical Analysis (December 2015). NBER Working Paper No. w21835, Available at SSRN: https://ssrn.com/abstract=2710467

Hugh Macartney (Contact Author)

Duke University - Department of Economics ( email )

213 Social Sciences Building
Box 90097
Durham, NC 27708-0204
United States

Robert McMillan

University of Toronto - Department of Economics ( email )

150 St. George Street
Toronto, Ontario M5S 3G7
Canada
416-978-4190 (Phone)
416-978-6713 (Fax)

Uros Petronijevic

New York University (NYU) - Department of Economics ( email )

19 West 4th Street
New York, NY 10012
United States

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