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The Importance of Relative Performance Feedback Information: Evidence from a Natural Experiment using High School Students

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Author Info
Ghazala Azmat
Nagore Iriberri
Abstract

We study the effect of providing relative performance feedback information on performance underpiece-rate incentives. A natural experiment that took place in a high school offers an unusualopportunity to test this effect in a real-effort setting. For one year only, students received informationthat allowed them to know whether they were above (below) the class average as well as the distancefrom this average. We exploit a rich panel data set and find that the provision of this information ledto an increase of 5% in students' grades. Moreover, the effect was significant for the wholedistribution. However, once the information was removed the effect disappeared. To rule out theconcern that the effect may be driven by teachers within the school, we verify our results usingnational level exams (externally graded) for the same students, and the effect remains.

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Paper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number dp0915.

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Date of creation: Mar 2009
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Handle: RePEc:cep:cepdps:dp0915

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Related research
Keywords: school performance; relative performance; piece-rate; feedback; natural experiment; socialcomparison; self-perception; competitive preferences;

Find related papers by JEL classification:
I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
M52 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
C30 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - General

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