Should We Pay Students for Higher Grades?

Nearly 20 percent of public school students in the United States failed to graduate on time in 2012. We know that failing to get a high school diploma is associated with fewer job prospects, lower earning potential, and it can even affect family life.

If you have a student or child who is at risk of not graduating, you may be willing to try everything to convince them to work harder in school, up to and including paying for better grades.

But could offering cash actually work best?

In a recent study published in National Bureau of Economic Research, researchers found that financial incentives improved high school students' academic performance and behavior by 15 to 22 percent on average compared to students who were not offered the incentives.

Should we pay students for good grades? Let us know what you think in the comments.

But even more impressively, for students who were closest to threshold of the achievement standards, the financial incentives appear to have improved their performance on average by 34 to 40 percent. Since this type of student is at risk of not graduating high school, these improvements might prove highly impactful over the long term.

Many people find the idea of paying students for good grades immediately distasteful or ridiculous. Amy McCready, a writer on parenting wrote disapprovingly of the idea in the New York Times.

"Our children’s success, on their terms, is not something we can put a price on," she said. "Rewards also foster a 'what’s in it for me?' attitude. If the reward is money for good grades, it sends the message that the reason to work hard in school is to enrich your wallet rather than your mind.But regardless of our initial reactions, it's important to know whether such a system would actually work.

Previous research has suggested that tangible rewards like money may reduce students' intrinsic motivations to succeed. But this new research, in conjunction with similar evidence, may inspire some to reevaluate the received wisdom.

After all, companies often offer employees monetary bonuses to incentivize hard work and achievement. It makes sense that financial incentives could give a little extra motivation to students we want to see succeed.

The study's authors conducted a randomized control trial in the suburb of Chicago Heights, where incomes are low and dropout rates are high, to test the financial incentives..

Students in the study were broken up into two groups. Some of ninth graders would be given $50 a month, or $400 over the eight-month school year, if they met set standards of attendance, good behavior, grades, and standardized test scores. Others in a control group were not offered incentives, so the researchers could determine whether the incentives had an impact.

Student achievement standards were set and were measured by the number of unexcused absences, days of suspension, whether they received a C or higher in all classes, and whether they met grade level or improved on their previous performance on standardized tests.

If the students in the trial group met the standards in the given month, they received the money. As the researchers predicted, the incentives make the most difference for students on the threshold of achievements standards, while showing relatively minimal effects for those with the highest or lowest achievement scores.

However, the authors note that while improvements continue into the second year after the incentive program ended, the improvements disappeared in the following years. This suggests that if this kind of program were to be successful at actually improving graduation rates, it may have to be extended over a longer period of time and targeted more closely at those students who will predictably benefit most.

Critics of the idea worry that paying students for grades undermines the purpose of teaching students to love learning. They argue that we’re essentially bribing students for learning and that it will actually decrease their enthusiasm for academic achievement over time.

But others pointed to other cases in which financial incentives have led to academic success. For example, the National Science and Math Initiative has offered funding for financial rewards, usually around $100, to students who score high on Advanced Placement exams. They also give bonuses to teachers for good AP scores.

At least in some schools with these initiatives, there’s been a big spike in the number of students taking and passing the AP tests. In Texas, similar programs were associated with improvements in SAT and ACT scores. It doesn’t seem to have discouraged a love of learning, and minority students are among those who benefit most.

Jay Matthews, an education writer for the Washington Post, initially a skeptic of this type of plan, has changed his mind in light of some of this evidence.

"If the National Math and Science Initiative wants to offer your children and their teachers money for hard work, I say take it, and see what happens," he wrote.

Photo Credit: Woodley Wonderworks via Flickr