Understanding the Response to High-Stakes Incentives in Primary Education

The paper studies responses to high-stakes incentives arising from early ability tracking to better understand the impact of external incentives on student achievement. We use three complementary research designs exploiting differences in school track admission rules at the end of primary school in Germany’s early ability tracking system. Our results show that having to perform well to qualify for a better track raises students’ math, reading, listening, and orthography skills in grade 4, the final grade before tracking. Evidence from self-reported behavior suggests that these effects are driven by greater study effort but not parental responses. However, we also observe that stronger incentives decrease students' well-being and intrinsic motivation to study.

Max Bach is a research associate researcher at the ZEW Mannheim in the Department of Labour Markets and Human Resources.
Mira Fischer is Research Fellow of the WZB Research Unit Market Behavior.