Can Teachers' Rewards Improve Educational Outcomes? The Role of Financial and Nonfinancial Rewards

• In Event: Marriott Roundtable Session 17
  In Roundtable Session: Teacher Development

Abstract

Inspired by the theoretical power of rewards in the labor market, to improve educational outcomes, this paper tests if giving a non-financial reward along with a financial one can result in higher student ex-post outcomes than just a financial incentive. The underlying mechanism by which non-financial reward might work is explored as well. The argument is based on Benabou and Tirole (2002)’s model, that non-financial reward may affect teachers’ self-esteem and, with that, their effort, and thereby the student outcomes after the reward is given. This is accomplished by a Sharp Regression Discontinuity Design that is used to identify the effect of AEP using data for more than 5,000 math and language teachers.

Author

• Martha Kluttig, Pontificia Universidad Catolica de Chile