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Conditional cash penalties in education: Evidence from the learnfare experiment

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  • Thomas Dee

Abstract

Wisconsin's influential Learnfare initiative is a conditional cash penalty program that sanctions a family's welfare grant when covered teens fail to meet school attendance targets. In the presence of reference-dependent preferences, Learnfare provides uniquely powerful financial incentives for student performance. However, a 10-county random-assignment evaluation suggested that Learnfare had no sustained effects on school enrollment and attendance. This study evaluates the data from this randomized field experiment. In Milwaukee County, the Learnfare procedures were poorly implemented and the random-assignment process failed to produce balanced baseline traits. However, in the nine remaining counties, Learnfare increased school enrollment by 3.7 percent (effect size = 0.08) and attendance by 4.5 percent (effect size = 0.10). The hypothesis of a common treatment effect sustained throughout the six-semester study period could not be rejected. These effects were larger among subgroups at risk for dropping out of school (e.g., baseline dropouts, those over age for grade). For example, these heterogeneous treatment effects imply that Learnfare closed the enrollment gap between baseline dropouts and school attendees by 41 percent. These results suggest that well-designed financial incentives can be an effective mechanism for improving the school persistence of at-risk students at scale.

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  • Thomas Dee, 2009. "Conditional cash penalties in education: Evidence from the learnfare experiment," Framed Field Experiments 00199, The Field Experiments Website.
  • Handle: RePEc:feb:framed:00199
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    2. Robert Metcalfe & Simon Burgess and Steven Proud, 2011. "Student effort and educational attainment: Using the England football team to identify the education production function," Economics Series Working Papers 586, University of Oxford, Department of Economics.
    3. Kendall J. Kennedy, 2020. "The Unexpected Effects of No Pass, No Drive Policies on High School Education," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 39(1), pages 191-217, January.
    4. Gisselquist, Rachel & Niño-Zarazúa, Miguel, 2013. "What can experiments tell us about how to improve governance?," MPRA Paper 49300, University Library of Munich, Germany.
    5. Åslund, Olof & Engdahl, Mattias, 2018. "The value of earning for learning: Performance bonuses in immigrant language training," Economics of Education Review, Elsevier, vol. 62(C), pages 192-204.
    6. Doyle, Mary-Alice & Schurer, Stefanie & Silburn, Sven, 2022. "Unintended consequences of welfare reform: Evidence from birthweight of Aboriginal children in Australia," Journal of Health Economics, Elsevier, vol. 84(C).
    7. Lester Lusher, 2016. "College Better: Parimutuel Betting Markets as a Commitment Device and Monetary Incentive," Natural Field Experiments 00561, The Field Experiments Website.
    8. Christilyn Juarez Arcayna & Jonelyn Juarez Arcayna & Resty Juarez Arcayna, 2021. "Implementation of 4PS Conditional Cash Transfer and Students’ School Attendance in Don Vicente Romualdez National High School," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 5(12), pages 907-922, December.
    9. Steven D. Levitt & John A. List & Sally Sadoff, 2016. "The Effect of Performance-Based Incentives on Educational Achievement: Evidence from a Randomized Experiment," NBER Working Papers 22107, National Bureau of Economic Research, Inc.
    10. Moshe Justman & Kyle Peyton, 2018. "Enforcing Compulsory Schooling through Credible Coercion: Lessons from Australia's Northern Territory Intervention," The Economic Record, The Economic Society of Australia, vol. 94(306), pages 223-238, September.
    11. Philip J. Cook & Jens Ludwig, 2010. "Economical Crime Control," NBER Working Papers 16513, National Bureau of Economic Research, Inc.
    12. Márton Medgyesi & Temesváry, Z., 2013. "GINI DP 84: Conditional cash transfers in high- income OECD countries and their effects on human capital accumulation," GINI Discussion Papers 84, AIAS, Amsterdam Institute for Advanced Labour Studies.
    13. Roland G. Fryer, Jr, 2010. "Racial Inequality in the 21st Century: The Declining Significance of Discrimination," NBER Working Papers 16256, National Bureau of Economic Research, Inc.
    14. Deborah A. Cobb-Clark & Nathan Kettlewell & Stefanie Schurer & Sven Silburn, 2023. "The Effect of Quarantining Welfare on School Attendance in Indigenous Communities," Journal of Human Resources, University of Wisconsin Press, vol. 58(6), pages 2072-2110.
    15. Metcalfe, Robert & Burgess, Simon & Proud, Steven, 2019. "Students' effort and educational achievement: Using the timing of the World Cup to vary the value of leisure," Journal of Public Economics, Elsevier, vol. 172(C), pages 111-126.
    16. Rashmi Barua & Marian Vidal-Fernandez, 2014. "No Pass No Drive: Education and Allocation of Time," Journal of Human Capital, University of Chicago Press, vol. 8(4), pages 399-431.
    17. Martorell, Paco & Miller, Trey & Santibañez, Lucrecia & Augustine, Catherine H., 2016. "Can incentives for parents and students change educational inputs? Experimental evidence from summer school," Economics of Education Review, Elsevier, vol. 50(C), pages 113-126.
    18. Uwe Dulleck & Juliana Silva-Goncalves & Benno Torgler, 2016. "Evaluation of an Incentive Program on Educational Achievement of Indigenous Students," The Economic Record, The Economic Society of Australia, vol. 92(298), pages 329-347, September.
    19. Uwe Dulleck & Juliana Silva-Goncalves & Benno Torgler, 2014. "Impact Evaluation of an Incentive Program on Educational Achievement of Indigenous Students," CREMA Working Paper Series 2014-13, Center for Research in Economics, Management and the Arts (CREMA).
    20. Uwe Dulleck & Juliana Silva-Goncalves & Benno Torgler, 2014. "Impact Evaluation of an Incentive Program on Educational Achievement of Indigenous Students," CREMA Working Paper Series 2014-13, Center for Research in Economics, Management and the Arts (CREMA).
    21. Edberg, Dana & Mukhopadhyay, Sankar & Wendel, Jeanne, 2019. "Incentive design to boost health for juveniles with Medicaid coverage: Evidence from a field experiment," Economics & Human Biology, Elsevier, vol. 33(C), pages 101-115.

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    JEL classification:

    • I2 - Health, Education, and Welfare - - Education
    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty

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