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

This research examines the effects of both financial and non-financial rewards on student test scores, with important implications for high stakes tests. Through a series of field experiments involving thousands of primary and secondary school students, the researchers found substantial incentive effects from both financial and non-financial incentives on test scores. Second, they found that non-financial incentives were considerably more cost-effective than financial incentives for younger students, but were less effective with older students. Third, and perhaps most importantly, they found that all motivating power of the incentives vanished when rewards were handed out with a delay. Since the rewards to educational investment virtually always come with a delay, their results suggest that existing incentives likely have little effect on test scores. Fourth, they did not find an increased response of effort when rewards were framed as losses. Their 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.

Content Comments 

The authors discuss the results of a study involving 6,500 low-income students in the Chicago Public Schools and the impact of financial and non-financial incentives on test performance. This is a highly technical paper, but the findings are discussed in a way that is clear and applicable to almost any audience. Some of the findings refute prior research in this area (e.g., incentives framed as losses have resulted in as great or greater achievement results in past research), and merit additional examination. Overall, this is a very interesting study with substantive implications for policy and classroom instructional practice for motivating student performance.