Tuesday, July 3, 2012

Mind:  The Right Way to Bribe Kids

In this study, economists offered students of different ages money or trophies just before they took a test. Sometimes, the students got the reward first with the possibility that it could be revoked for bad performance. Sometimes, the students were only shown the reward after. So what did the economists find? Four really cool things.

First, they found that money works, and the amount of money really matters. Students were reportedly willing to exert significantly more energy at $80-an-hour, but not at $40-an-hour. (Authors: "As far as we know, ours is the first study to demonstrate that student responsiveness to incentives is sensitive to the size of the reward.").

Second, they learned that the rewards were most powerful when they were framed as losses rather than gains (i.e.: "Here is $20. If you fail, I'm taking it away.") The technical term for this is loss aversion and it's endemic. We're more protective of money we have -- or think we have -- than we are aggressive about seeking money we don't have.

Third, they learned that "non-financial incentives," like trophies, worked best with young people.

Fourth, they learned that rewards provided with a delay -- "we'll get you that check in a month!" -- did very little to improve performance. The power of hyperbolic discounting is strong with these ones.

For more, see Freakonomics Goes to School and Teaches Us the Right Way to Bribe Kids by Derek Thompson, June 19, 2012 at The Atlantic.

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