|Chicago Heights, IL|
2010 - 2011
Our previous research investigated group-based incentives, and found little impact on student achievement. In this project, we ask the following: can loss aversion might be leveraged to greater effect to alter teacher behavior and ultimately boost student achievement?
At the beginning of the 2010-2011 school year, teachers in nine Chicago Heights schools were randomly selected to participate in a pay-for-performance program. One group was given "traditional" incentives in the form of year-end bonuses tied to their impact on student achievement. The other group was given up-front incentives, with the understanding that they would have to return some-or-all of the advance bonus if students didn't meet expected achievement targets.
Read the full NBER Working Paper here.
This study suggests that framing an incentive program in terms of losses rather than gains can yield improved student achievement. The impact we observed was large, and these results have significant implications for designing performance pay programs across the education sector.