Should We Pay Students to Go to School?
Think back to when you were a high school student. Remember all that time you spent slaving away, studying for those stress-inducing examinations, attending those tedious classes, and writing those ill-informed essays?
There must have been some days where your motivation was seriously waning—and for good reason. School can be extremely difficult, especially for those of us who are less academically gifted, and studying can take away much of our free time. Focusing on academics is even more difficult when you need a job outside of school to support yourself, and your family too.
Difficulties such as these can lead some students to drop out of school altogether. Although these students may see dropping out of high school as a good idea, dropping out typically has drastic socioeconomic consequences in the long-term. When compared with high school graduates, high school dropouts are more likely to earn substantially lower wages, be unemployed, suffer adverse health issues, and generate higher social costs for taxpayers through criminal activity and public assistance.1 Despite these long-term consequences, in 2017, over 500,000 students dropped out of high school in the U.S., while an even greater number were not enrolled in school at all.2
References
[1] Rumberger, R. (2013). Poverty and high school dropouts. Retrieved 29 January 2021, from https://www.apa.org/pi/ses/resources/indicator/2013/05/poverty-dropouts
[2] Trends in High School Dropout and Completion Rates in the United States. Retrieved 29 January 2021, from https://nces.ed.gov/programs/dropout/findings.asp
[3] Doll, J. J., Eslami, Z., & Walters, L. (2013). Understanding Why Students Drop Out of High School, According to Their Own Reports: Are They Pushed or Pulled, or Do They Fall Out? A Comparative Analysis of Seven Nationally Representative Studies. SAGE Open. https://doi.org/10.1177/2158244013503834
[4] Survivorship bias – Biases & Heuristics. Retrieved 29 January 2021, from https://thedecisionlab.com/biases/survivorship-bias/
[5] Incentivization – Biases & Heuristics. Retrieved 29 January 2021, from https://thedecisionlab.com/biases/incentivization/
[6] Gneezy, U., & Rustichini, A. (2000). Pay enough or don’t pay at all. The Quarterly journal of economics, 115(3), 791-810.
[7] List, J. A., Livingston, J. A., & Neckermann, S. (2018). Do financial incentives crowd out intrinsic motivation to perform on standardized tests?. Economics of Education Review, 66, 125-136.
[8] Behrman, J. R., Sengupta, P., & Todd, P. (2005). Progressing through PROGRESA: An impact assessment of a school subsidy experiment in rural Mexico. Economic development and cultural change, 54(1), 237-275.
[9] Barrera-Osorio, F., Bertrand, M., Linden, L. L., & Perez-Calle, F. (2008). Conditional cash transfers in education: design features, peer and sibling effects evidence from a randomized experiment in Colombia. The World Bank.
[10] Gneezy, U., Meier, S., & Rey-Biel, P. (2011). When and why incentives (don’t) work to modify behavior. Journal of economic perspectives, 25(4), 191-210.
[11] Fryer Jr, R. G. (2011). Financial incentives and student achievement: Evidence from randomized trials. The Quarterly Journal of Economics, 126(4), 1755-1798.
[12] Levitt, S. D., List, J. A., & Sadoff, S. (2016). The effect of performance-based incentives on educational achievement: Evidence from a randomized experiment (No. w22107). National Bureau of Economic Research.
[13] Croson, R., and Gneezy, U. (2009). Gender Differences in Preferences. Journal of Economic Literature, 47 (2): 448-74.
[14] Angrist, J., and Lavy, V. (2009). The Effects of High Stakes High School Achievement Awards: Evidence from a Randomized Trial. American Economic Review, 99 (4): 1384-1414.
[15] Groot, B., & Sanders, M. (2017). Supportive text messaging to encourage student success. Retrieved 30 January 2021, from https://www.bi.team/blogs/supportive-text-messaging-to-encourage-student-success/
About the Author
Tony Jiang
Tony Jiang is a Staff Writer at the Decision Lab. He is highly curious about understanding human behavior through the perspectives of economics, psychology, and biology. Through his writing, he aspires to help individuals and organizations better understand the potential that behavioral insights can have. Tony holds an MSc (Distinction) in Behavioral Economics from the University of Nottingham and a BA in Economics from Skidmore College, New York.
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