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Do Scores Go Up When Teachers Return Bonuses?

Filed by KOSU News in Business.
September 19, 2012

In Chicago, parents were fuming over a weeklong strike by teachers. Around the rest of the country, in the face of growing evidence that many U.S. students are falling behind, administrators have tried to devise different ways to motivate teachers.

Among the contentious issues is whether teachers should be held accountable for their students’ performance on standardized tests. Such efforts have produced enormous conflicts between school districts and teachers. In many parts of the country, administrators and teachers have fought one another to a standstill.

That’s where a novel social science study may have the potential to shift the conversation.

Economist John List at the University of Chicago recently conducted an unusual field experiment in Chicago Heights, a school district near Chicago. List and his colleagues found a struggling school district: Only 64 percent of students met minimum state requirements on achievement tests. Nearly all the kids qualified for free or reduced-price school lunches, a measure of straitened socio-economic conditions.

List and his colleagues, Roland G. Fryer, Steven Levitt and Sally Sadoff, divided 150 teachers into three groups. One group got no incentive; they just went about their school year as usual. A second group was promised a bonus if their students did well at math.

The third group is where the psychology came in: The teachers were given a bonus of $4,000 upfront — but it had a catch. If student math performance didn’t improve, teachers had to sign a contract promising to return some or all of the money.

Other U.S. studies have found limited evidence that traditional bonuses do much to shift student scores.

List said the idea of giving some teachers money upfront — with the threat of taking it away later — builds on a well-known psychological principle: “What we tried to capitalize on in this particular study was a concept called loss aversion,” he said. “Once we have something in our possession, we feel it would be really, really painful to have to give it up.”

Loss aversion has been shown to be a powerful motivator in many business settings, but List said this was the first rigorous test of the principle in an educational setting. The idea, he said, was that by giving teachers the money upfront, they might work harder to keep the money at the end of the year than they would if the money had been promised as a traditional bonus.

In line with earlier work, List and his colleagues found that students of teachers who received the traditional bonus performed no better than students of teachers who received no incentive at all. But List found that students of teachers who were given the bonus upfront showed significant improvement in math test scores.

“What we found is strong evidence in favor of loss aversion,” he said. “Teachers who were paid in advance and [were] asked to give the money back if their students did not perform — their [students'] test scores were actually out of the roof: two to three times higher than the gains of the teachers in the traditional bonus group.”

The difference in test scores produced by the incentive system was about the same as that detected in earlier studies that measured differences in student performance when kids were taught by great teachers rather than average teachers. Effectively, List said, the way the incentive was constructed turned average teachers into great teachers.

List said he thinks that the incentive system motivated teachers to be extra vigilant with underperforming students. If Johnny didn’t get a concept, a teacher stuck with Johnny — and the concept — until the kid got it.

There are several caveats to keep in mind before anyone can talk about implementing the bonus structure widely, List said. Among them: The study needs replication. It remains to be seen whether the gains in student performance are long-lasting, and whether the same increases in student performance can be found in subjects other than math.

List said future studies might also tweak the incentive system: Teachers may be asked to return the money for underperformance periodically, rather than all at once at the end of the year. Prior studies involving loss aversion have found that the technique is more effective when people feel the threat of periodic and regular losses.

But there’s another catch: List warned that the bonus system needed buy-in from teachers. Teaching isn’t like making widgets; it requires motivation and passion. If teachers feel they are being manipulated rather than encouraged to improve their performance, they could end up looking for other lines of work. [Copyright 2012 National Public Radio]

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