an Eldis Resource
Teacher incentives in developing countries: experimental evidence from India
Improving education through performance-based pay in Andhra Pradesh, India- does it work?
Authors:
K. Muralidharan; V. Sundararaman
Publisher:
World Bank, 2006
Performance pay for teachers is frequently suggested as a way of improving educational outcomes in schools, but the empirical evidence to date on its effectiveness is limited and mixed. This study presents results from a randomized evaluation of a teacher incentive program implemented across a representative sample of government-run rural primary schools in the Indian state of Andhra Pradesh. The program provided bonus payments to teachers based on the average improvement of their students' test scores in independently administered learning assessments (with a mean bonus of 3% of annual pay).
This paper attempts to answer the following questions in the context of primary education in a developing country:
- Can teacher incentives based on test scores improve student achievement?
- What, if any, are the negative consequences of teacher incentives?
- How do school-level group incentives perform relative to teacher-level individual incentives?
- What is the impact of simply monitoring schools and measuring students' achievement without attaching incentives?
- How does teacher behavior change in response to incentives?
- How cost effective are teacher incentives relative to other uses for the same money?
- Will teachers support the idea?
Students in incentive schools performed significantly better than those in control schools by 0.19 and 0.12 standard deviations in math and language tests respectively. They scored significantly higher on "conceptual" as well as "mechanical" components of the tests suggesting that the gains in test scores represented an actual increase in learning outcomes. Incentive schools also performed better on subjects for which there were no incentives. The study found no significant difference in the effectiveness of group versus individual teacher incentives. Incentive schools performed significantly better than other randomly chosen schools that received additional schooling inputs of a similar value.
The main caveat to the results presented here is that they only represent data from the first year of the program. The impact of the incentives may be larger in subsequent years, once the program's credibility is established; but it is also possible that the gains in test scores may not persist in future years, once the novelty of the program wears off. The study also states that it does not know how an understanding of the dynamics of student learning will affect a rational teacher's response to an incentive program in the long run, and if unanticipated dimensions of gaming will emerge as teachers become more familiar with the program.
