Incentives Work: Getting Teachers to Come to School

We use a randomized experiment and a structural model to test whether monitoring and financial incentives can reduce teacher absence and increase learning in rural India. In treatment schools, teachers’ attendance was monitored daily using cameras, and their salaries were made a nonlinear function of attendance. Absenteeism by teachers fell by 21 percentage points relative to the control group, and children’s test scores increased by 0.17 standard deviations. We estimate a structural dynamic labor supply model and find that teachers responded strongly to the financial incentives, and that this alone can explain the difference between the two groups. Our model is used to compute cost-minimizing compensation policies. ∗This project is a collaborative exercise involving many people. Foremost, we are deeply indebted to Seva Mandir, and especially to Neelima Khetan and Priyanka Singh, who made this evaluation possible. We thank Ritwik Sakar and Ashwin Vasan for their excellent work coordinating the fieldwork. Greg Fischer, Shehla Imran, Callie Scott, Konrad Menzel, and Kudzaishe Takavarasha provided superb research assistance. For their helpful comments, we thank referees, Abhijit Banerjee, Rachel Glennerster, Michael Kremer and Sendhil Mullainathan. We owe a special thank to the referees, who made substantial suggestions that considerably improved the paper. For financial support, we thank the John D. and Catherine T. MacArthur Foundation. †The authors are from MIT (Department of Economics and J-PAL), the Kennedy School of Government of Harvard University and J-PAL, and MIT (Department of economics)