Financial Incentives and Educational Investment: The Impact of Performance-based Scholarships on Student Time Use

Lisa Barrow and Cecilia Elena Rouse
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Cecilia Elena Rouse: Katzman-Ernst Professor in the Economics of Education Woodrow Wilson School of Public and International Affairs Princeton University Princeton, NJ 08544 Author email: rouse@princeton.edu

Education Finance and Policy, 2018, vol. 13, issue 4, 419-448

Abstract: We evaluate the effect of performance-based scholarship programs for postsecondary students on student time use and effort. We find evidence that financial incentives induced students to devote more time and effort to educational activities and allocate less time to other activities. Incentives did not generate impacts after eligibility ended and did not decrease students’ interest or enjoyment in learning. Evidence also suggests that students were motivated more by the incentives than simply the effect of additional money. A remaining puzzle is that larger scholarships did not generate larger responses in terms of effort.

Date: 2018
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Related works:
Working Paper: Financial incentives and educational investment: the impact of performance-based scholarships on student time use (2013)
Working Paper: Financial Incentives and Educational Investment: The Impact of Performance-Based Scholarships on Student Time Use (2013)
Working Paper: Financial Incentives and Educational Investment: The Impact of Performance-Based Scholarships on Student Time Use (2013)
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