The researchers tested a financial incentive for teachers to attain a certain performance level using multiple conditions. In the loss condition, teachers received a transfer in the beginning of the period and had to pay back some of it if they did not achieve their performance goals. In the gain condition they received the money after the period. The study shows that students whose teachers were in loss condition performed significantly better than those in the gain condition.
Other Applications: Savings and Financial Decisions, Tax Compliance, Law Abiding Behavior