Paying to Learn: The Effect of Financial Incentives on Elementary School Test Scores
Policymakers and academics are increasingly interested in applying financial incentives to individuals in education. This paper presents evidence from a pay for performance program taking place in Coshocton, Ohio. Since 2004, Coshocton has provided cash payments to students in grades three through six for successful completion of their standardized testing. Coshocton determined eligibility for the program using randomization, and using this randomization, this paper identifies the effects of the program on students' academic behavior. We find that math scores improved about 0.15 standard deviations but that reading, social science, and science test scores did not improve.
The author thanks Bob Simpson and the Coshocton City Schools, especially Patty Cramer, Wade Lucas and David Hire, for help throughout the project. The author also thanks Jim Rebitzer, David Cooper, Michael Kremer, Bridget Long, Ted Miguel, Phil Oreopoulos, and seminar participants at Case Western Reserve University, University of British Columbia, University of Arizona, University of Pittsburgh, Stanford University, UCLA, Georgetown, and Ohio State University for helpful comments. All opinions and mistakes are my own. The views expressed herein are those of the author and do not necessarily reflect the views of the National Bureau of Economic Research.
Eric P. Bettinger, 2012. "Paying to Learn: The Effect of Financial Incentives on Elementary School Test Scores," The Review of Economics and Statistics, MIT Press, vol. 94(3), pages 686-698, August. citation courtesy of