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The importance of relative performance feedback information: Evidence from a natural experiment using high school students

  • Ghazala Azmat
  • Nagore Iriberri

We study the effect of providing relative performance feedback information on performance, when individuals are rewarded according to their absolute performance. A natural experiment that took place in a high school offers an unusual opportunity to test this effect in a real-effort setting. For one year only, students received information that allowed them to know whether they were performing above (below) the class average as well as the distance from this average. We exploit a rich panel data set and find that the provision of this information led to an increase of 5% in students’ grades. Moreover, the effect was significant for the whole distribution. However, once the information was removed, the effect disappeared. To rule out the concern that the effect may be artificially driven by teachers within the school, we verify our results using national level exams (externally graded) for the same students, and the effect remains.

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File URL: http://www.econ.upf.edu/docs/papers/downloads/1148.pdf
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Paper provided by Department of Economics and Business, Universitat Pompeu Fabra in its series Economics Working Papers with number 1148.

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Date of creation: Jan 2009
Date of revision: Mar 2010
Handle: RePEc:upf:upfgen:1148
Contact details of provider: Web page: http://www.econ.upf.edu/

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