Economics of schools Simon Burgess

1. Economics of schools Simon Burgess

2.  Education matters simonburgesseconomics.co.uk

3.  Education matters • For individuals: • Personal fulfilment and well-being • Earnings and unemployment • Health, longevity, civic engagement • “Escape” • For countries: • Growth and prosperity • Inequality and poverty • Social mobility simonburgesseconomics.co.uk

4.  Education matters • Growth and prosperity • The data show a strong relationship between cognitive skills in a country and its economic growth • If we could close the gap between UK’s PISA score and the top performers, we could add about 0.3 percentage points to our growth rate. • Hanushek and Woessmann, 2015 simonburgesseconomics.co.uk

5.  Education matters • Inequality and poverty • Poverty: those with a low level of attainment are almost five times as likely to be in poverty now as those with a high level of education. • Severe material deprivation: those with low attainment are eleven times as likely to be severely deprived as those with a high level of education. • ONS, 2014 simonburgesseconomics.co.uk

6.  Education matters • Social mobility • Cross country analysis shows strong correlation between social mobility and public expenditure on education • Ichino et al. (2009) simonburgesseconomics.co.uk

7.  Education matters • Social mobility • Cross country analysis shows strong correlation between social mobility and public expenditure on education • “There was nothing in my story that would land me here. I wasn’t raised with wealth or resources or any social standing to speak of. If you want to know the reason why I ’m standing here, it’s because of education. I never cut class. I liked being smart. I loved being on time. I loved getting my work done. I thought being smart was cooler than anything in the world.” • Ichino et al. (2009) simonburgesseconomics.co.uk

8.  Education matters • Social mobility • Cross country analysis shows strong correlation between social mobility and public expenditure on education • “There was nothing in my story that would land me here. I wasn’t raised with wealth or resources or any social standing to speak of. If you want to know the reason why I ’m standing here, it’s because of education. I never cut class. I liked being smart. I loved being on time. I loved getting my work done. I thought being smart was cooler than anything in the world.” • Michelle Obama, 2009. • Ichino et al. (2009) simonburgesseconomics.co.uk

9. Education and schools • Schools contribute hugely to education • Obviously not the only source: • Families, especially but not only in the early years • Universities • Schools are key for policy: • Pupils are locked up together in known locations for over 10,000 hours and supervised by agents of the state. simonburgesseconomics.co.uk

10. What matters for schools? • Money? • Class size? • IT? • Inspirational leadership? • Teachers? simonburgesseconomics.co.uk

11. Money? simonburgesseconomics.co.uk

12. Class size? • Maybe. But very mixed evidence – most studies say little or no effect on attainment • Depends on the pupils • Very, very expensive: • Eg. California Class Size Reduction – • Biggest programme ever from max 33 to max 20. • Needed to hire 50% more teachers • Fraction of unqualified teachers rose sharply, esp. for poorest simonburgesseconomics.co.uk

13. Information Technology? • “Every child to have a laptop/iPad/VR ….” • No evidence whatsoever that it is helpful simonburgesseconomics.co.uk

14. Inspirational leadership? • Surely helps • But … its not a policy idea • We can’t generate “inspirational” leaders • We want a system that works, not rely on personalities simonburgesseconomics.co.uk

15. Teachers? • Yes • But “quality” not quantity • Teacher effectiveness is very important simonburgesseconomics.co.uk

16. Other key actor in schools: • Pupils!! • Their decisions: • Choices of subject etc • Effort and engagement • Effort and engagement • Is important for attainment • Is related to psychological traits • Can be affected by interventions? simonburgesseconomics.co.uk

17. Effort matters for attainment • Every other year – big, big distraction during exams … simonburgesseconomics.co.uk

18. Effort matters for attainment • Every other year – big, big distraction during exams … • GCSE exams and World Cup/Euro Championship • Work hard? Or watch TV, talk football to friends ? simonburgesseconomics.co.uk

19. Effort matters for attainment • Every other year – big, big distraction during exams … • GCSE exams and World Cup/Euro Championship • Work hard? Or watch TV, talk football to friends … • Increase in % getting 5+ strong passes (5A*-C(EM)): simonburgesseconomics.co.uk

20. From football to marshmallows: simonburgesseconomics.co.uk

21. Marshmallow experiment • Stanford marshmallow experiment • Children were left alone in a room with a marshmallow • “If you leave the marshmallow alone for 15 minutes, you can have two!” • Children who displayed self-control were “more able to sustain effort and deal with frustration”. simonburgesseconomics.co.uk

22. Socio-emotional skills, psychological traits • ‘Effort’ and ‘engagement’ are related concepts to: • Non-cognitive attributes • One of the big 5 psychological traits (conscientiousness). • Can pupils learn the value of conscientiousness? • Can we induce it? simonburgesseconomics.co.uk

23. Effort, motivations … and incentives • What motivates pupils? • How could we increase effort? • There is a ‘natural’ incentive to work hard at school • But maybe not perceived by some • Fryer: use incentives as “a way to straddle the perceived cost of investing in human capital now with the future benefit of investment.” simonburgesseconomics.co.uk

24. What we do • This project: • Focussed on effort and engagement over a school year • Try different ways of incentivising students: • Financial treatment • Event treatment • “Effort”: attendance at school; coursework and homework completed; conduct in class. • Randomised Controlled Trial design simonburgesseconomics.co.uk

25. Questions • Does pupil effort matter? Does it matter a lot? • Can we intervene to alter pupil motivations to induce greater effort? • Are there important differences in pupil motivations related to observable characteristics? simonburgesseconomics.co.uk

26. Large scale • 10,000+ kids in 63 schools • Paid out > £0.5m in financial incentives • Each kid takes 3 subjects each so approx 30,000 attainment outcomes • 7,500 kids with behaviour data simonburgesseconomics.co.uk

27. Design of the intervention • Target of incentive • Inputs not outputs (knowledge, timing) • Types of incentive • Cash, Events • School-year level rather than pupil level • Time unit is a half-term (5 weeks) • Not all subjects: just English, Maths, Science • Threshold design simonburgesseconomics.co.uk

28. Sample • Regular state secondary schools • Poorest 10% of neighbourhoods • Not conditional on school performance (so some high-performing schools in) simonburgesseconomics.co.uk

29. simonburgesseconomics.co.uk

30. What did we find? • Overall, the average effect was positive, but small, and not statistically distinguishable from zero. • But there was huge variation around the average. • Why? • Some pupils were already motivated and working very hard, and we would expect to have little effect on them • Some were not motivated and not putting in the effort. This is where we hope to make a difference. • Who is highly motivated? Who works hard? simonburgesseconomics.co.uk

31. Maths simonburgesseconomics.co.uk

32. Maths English Science simonburgesseconomics.co.uk

33. Big differences in impact: simonburgesseconomics.co.uk

34. One big predictor of the impact: • For the financial treatment, English as an Additional Language explains a lot of the predicted treatment effect • Why is EAL relevant and interesting? • Pupils for whom English is an Additional Language make outstanding progress through school. • That ‘extra’ comes from somewhere – its not generally material advantages; it maybe aspirations, and positive attitudes towards school. simonburgesseconomics.co.uk

35. Who are the high effectiveness kids? simonburgesseconomics.co.uk

36. Answers • Does pupil effort matter? Does it matter a lot? • On average over the sample, not much. • But splitting the sample, yes, a lot for some. • Can we intervene to alter pupil motivations to induce greater effort? • Potentially – one incentive worked well. • Are there important differences in pupil motivations related to observable characteristics? • Strongly differing effects. simonburgesseconomics.co.uk

37. Long-run effects? • Pupils’ effort levels revert to pre-intervention levels? • Explicit monetised reward diminishes subsequent implicit motivation for learning? • Pupils update their views of the education production function? • The introduction of incentives temporarily induces higher effort. If this translates into higher attainment this updates beliefs about the marginal value of effort and hence raises effort permanently. • We will test. simonburgesseconomics.co.uk

38. Raising effort and engagement • Socioemotional skills: conscientiousness • Beliefs in own ability and return to effort • Other motivations • School regime simonburgesseconomics.co.uk

39. Conscientiousness Inherent motivations Outcome Effort simonburgesseconomics.co.uk

40. Conscientiousness Inherent motivations Outcome Effort ? Incentives simonburgesseconomics.co.uk

41. ? Conscientiousness Beliefs Inherent motivations Outcome Effort ? Incentives simonburgesseconomics.co.uk

42. Finishing up • Education matters • Schools matter for education • What matters for schools? • Effective teachers • Motivated and engaged pupils • Evidence!! simonburgesseconomics.co.uk

43. Financial incentive (T1) • Reward • Each student starts with an allocation of £320 • £80 of this is available for each of the first four half-terms. • Money lost as follows: £10 for missing the attendance threshold; £10 for behaviour; £30 for class-work; £30 for homework. • Feedback • Each child receives a letter after each half-term reporting how they did in the preceding half-term on all four behaviours. • It will also inform them about the outcome for their money. • The letter will be addressed to them (not their parents) and posted to their home address. simonburgesseconomics.co.uk

44. Event incentive (T2) • Reward • Each student is able to participate in two events per year, in December after the second half-term and again in April • Each student starts off with 8 tickets per half-term, and may lose them as follows: 1 for missing the attendance target, 1 for behaviour; 3 for class-work and 3 for homework. • So by the end of the two half-terms before Christmas they could have a maximum of 16 tickets. To go on the trip they need 12 tickets. • The two rounds are separate and distinct: in January, each student starts afresh with 8 tickets. • Feedback • Same as for Finance Incentive simonburgesseconomics.co.uk