Better Educator Incentives Can Improve Primary School Completion

Primary school completion rates remain low, and educator accountability remains weak in many low-income countries. The accountability pressures that do exist often create perverse incentives. For example, many African countries use leaving exams to certify primary completion. Governments often publish leaving exam results and punish school leaders when their students fail, but these same governments do not track student dropouts. So, school administrators face clear incentives to pressure weak students to drop out before they take their leaving exams.

Daniel Gilligan, Naureen Karachiwalla, Ibrahim Kasirye, Adrienne Lucas, and Derek Neal conducted a teacher incentive experiment in rural Uganda. The Pay for Percentile (PFP) system pays each teacher a separate bonus for each student who takes an end-of-year exam. This bonus is an increasing function of student achievement growth during the school year. PFP sought to both improve achievement and reduce dropout rates by encouraging teachers to give more attention to all students.

The PFP program reduced Grade 6 dropout rates by four percentage points, from 44 percent to 40 percent. But there’s a twist—outcomes among the roughly fifty percent of schools that provide math books for their students drive this result. In these schools, dropout rates fell from 43 percent to 36 percent.

Further, in these same schools, students’ scores improved significantly on questions covered by Grade 6 math texts, especially among the students who began the year with the background required to use these texts. In schools without books, PFP produced no gains in attendance or achievement.

So, can teacher incentive systems linked to student achievement growth reduce dropout rates? According to the researchers, “Well-designed incentives can reduce dropout rates, but incentive systems for educators appear more valuable in schools with adequate instructional resources.”

Read the full study in the Journal of Human Resources: “Educator Incentives and Educational Triage in Rural Primary Schools,” by Daniel Gilligan, Naureen Karachiwalla, Ibrahim Kasirye, Adrienne Lucas, and Derek Neal.

Daniel Gilligan (@dogilligan) and Naureen Karachiwalla (@NKarachiwalla) are at IFPRI. Ibrahim Kasirye (@ikasirye_ug) is at the Economic Policy Research Centre. Adrienne Lucas (@ProfALucas) is at the University of Delaware, CGD, J-PAL, and NBER. Derek Neal is at the University of Chicago and NBER.

The authors gratefully acknowledge funding from the International Growth Centre (IGC); the Post Primary Education Initiative (PPE) of the Abdul Latif Jameel Poverty Action Lab (J-PAL); the Spencer Foundation; the Policies, Institutions, and Markets (PIM) Research Program of the Consultative Group for International Agricultural Research (CGIAR); and Lindy and Michael Keiser through a gift to the University of Chicago’s Committee on Education.