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Monetary Incentives And Student Achievement In A Depressed Labour Market: Results From A Randomized Experiment

Author

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  • Maria De Paola
  • Vincenzo Scoppa
  • Rosanna Nisticò

    (Dipartimento di Economia e Statistica, Università della Calabria)

Abstract

In this paper we carry out an evaluation of the effectiveness of monetary incentives in enhancing student performance using a randomized experiment involving undergraduate students enrolled at a Southern Italian University. Students participating at the experiment were assigned to three different groups: a high reward group, a low reward group and a control group. Rewards were assigned following a tournament rule to the 30 best performing students in each treated group. Findings suggest that financial rewards increase student performance both in terms of number of credits earned and grades obtained at exams. High ability students react strongly while the effect is null for low ability students. When the “intention-to-treat” effects are adjusted for non-participation using IV, it emerges a stronger impact of the treatment on student performance.

Suggested Citation

  • Maria De Paola & Vincenzo Scoppa & Rosanna Nisticò, 2010. "Monetary Incentives And Student Achievement In A Depressed Labour Market: Results From A Randomized Experiment," Working Papers 201006, Università della Calabria, Dipartimento di Economia, Statistica e Finanza "Giovanni Anania" - DESF.
    • Handle: RePEc:clb:wpaper:201006
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    References listed on IDEAS

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    Cited by:

    1. Damon Clark & David Gill & Victoria Prowse & Mark Rush, 2020. "Using Goals to Motivate College Students: Theory and Evidence From Field Experiments," The Review of Economics and Statistics, MIT Press, vol. 102(4), pages 648-663, October.
    2. Gong, Jie & Liu, Tracy Xiao & Tang, Jie, 2021. "How monetary incentives improve outcomes in MOOCs: Evidence from a field experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 190(C), pages 905-921.
    3. Hakimov, Rustamdjan, 2016. "Contests at the workplace with and without prize selection: Testing theory in a field experiment," Discussion Papers, Research Unit: Market Behavior SP II 2016-211, WZB Berlin Social Science Center.
    4. Florian Englmaier & Stefan Grimm & Dominik Grothe & David Schindler & Simeon Schudy, 2024. "The Efficacy of Tournaments for Nonroutine Team Tasks," Journal of Labor Economics, University of Chicago Press, vol. 42(4), pages 921-948.
    5. Islam,Asad & Kwon,Sungoh & Masood,Eema & Prakash,Nishith & Sabarwal,Shwetlena & Saraswat,Deepak, 2020. "When Goal-Setting Forges Ahead but Stops Short," Policy Research Working Paper Series 9406, The World Bank.
    6. Joshua Angrist & Philip Oreopoulos & Tyler Williams, 2014. "When Opportunity Knocks, Who Answers?: New Evidence on College Achievement Awards," Journal of Human Resources, University of Wisconsin Press, vol. 49(3), pages 572-610.
    7. Adam M. Lavecchia & Heidi Liu & Philip Oreopoulos, 2014. "Behavioral Economics of Education: Progress and Possibilities," NBER Working Papers 20609, National Bureau of Economic Research, Inc.
    8. Emmanuel Dechenaux & Dan Kovenock & Roman Sheremeta, 2015. "A survey of experimental research on contests, all-pay auctions and tournaments," Experimental Economics, Springer;Economic Science Association, vol. 18(4), pages 609-669, December.
    9. Bigoni Maria & Fort Margherita & Nardotto Mattia & Reggiani Tommaso G., 2015. "Cooperation or Competition? A Field Experiment on Non-monetary Learning Incentives," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 15(4), pages 1753-1792, October.
    10. V. Rattini, 2014. "The Causal Effect of Scholarships Targeted at Low Income Students on Performance: Evidence from Italy," Working Papers wp968, Dipartimento Scienze Economiche, Universita' di Bologna.
    11. Maria De Paola & Francesca Gioia & Vincenzo Scoppa, 2022. "Online Teaching, Procrastination And Students’ Achievement: Evidence From Covid-19 Induced Remote Learning," Working Papers 202202, Università della Calabria, Dipartimento di Economia, Statistica e Finanza "Giovanni Anania" - DESF.
    12. 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.
    13. Herranz-Zarzoso, Noemí & Sabater-Grande, Gerardo, 2018. "Monetary incentives and self-chosen goals in academic performance: An experimental study," International Review of Economics Education, Elsevier, vol. 27(C), pages 34-44.
    14. Sandner, Malte, 2013. "Quasi-Experimental Evaluation of a Student Mentoring Program," Hannover Economic Papers (HEP) dp-512, Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät.
    15. Damgaard, Mette Trier & Nielsen, Helena Skyt, 2018. "Nudging in education," Economics of Education Review, Elsevier, vol. 64(C), pages 313-342.
    16. Berry, James & Kim, Hyuncheol Bryant & Son, Hyuk Harry, 2022. "When student incentives do not work: Evidence from a field experiment in Malawi," Journal of Development Economics, Elsevier, vol. 158(C).
    17. Lisa Barrow & Cecilia Elena Rouse & Amanda McFarland, 2020. "Who Has the Time? Community College Students’ Time-Use Response to Financial Incentives," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 48(1), pages 35-52, March.
    18. Steven Levitt & John List & Sally Sadoff, 2016. "The Effect of Performance-Based Incentives on Educational Achievement: Evidence from a Randomized Experiment," Framed Field Experiments 00585, The Field Experiments Website.
    19. De Paola, Maria & Gioia, Francesca & Scoppa, Vincenzo, 2018. "The adverse consequences of tournaments: Evidence from a field experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 151(C), pages 1-18.
    20. Sacha Kapoor & Matthijs Oosterveen & Dinand Webbink, 2021. "The price of forced attendance," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 36(2), pages 209-227, March.
    21. Brunello, Giorgio & De Paola, Maria, 2013. "The Costs of Early School Leaving in Europe," IZA Discussion Papers 7791, Institute of Labor Economics (IZA).
    22. Brade, Raphael & Himmler, Oliver & Jäckle, Robert, 2018. "Normatively Framed Relative Performance Feedback – Field Experiment and Replication," MPRA Paper 88830, University Library of Munich, Germany.
    23. Gianluca Argentin & Aline Pennisi & Daniele Vidoni & Giovanni Abbiati & Andrea Caputo, 2014. "Trying to Raise (Low) Math Achievement and to Promote (Rigorous) Policy Evaluation in Italy: Evidence From a Large-Scale Randomized Trial," Evaluation Review, , vol. 38(2), pages 99-132, April.
    24. Maria Paola & Vincenzo Scoppa, 2014. "The effectiveness of remedial courses in Italy: a fuzzy regression discontinuity design," Journal of Population Economics, Springer;European Society for Population Economics, vol. 27(2), pages 365-386, April.
    25. Loris Vergolini & Nadir Zanini & Nicola Bazoli, 2014. "Liquidity Constraints and University Participation in Times of Recession. Evidence from a Small-scale Programme," FBK-IRVAPP Working Papers 2014-11, Research Institute for the Evaluation of Public Policies (IRVAPP), Bruno Kessler Foundation.

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    More about this item

    Keywords

    Education Production Function; Student Effort; Incentives; Merit Scholarship; Higher Education; Randomized Evaluation;
    All these keywords.

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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