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The Dynamic Effects of Educational Accountability

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  • Hugh Macartney

Abstract

This paper provides the first evidence that value-added education accountability schemes induce dynamic distortions. Extending earlier dynamic moral hazard models, I propose a new test for ratchet effects, showing that classroom inputs are distorted less when schools face a shorter horizon over which they can influence student performance. I then exploit grade span variation using rich educational data to credibly identify the extent of dynamic gaming, finding compelling evidence of ratchet effects based on a triple-differences approach. Further analysis indicates that these effects are driven primarily by effort distortions, with teacher reallocations playing a secondary role.

Suggested Citation

  • Hugh Macartney, 2014. "The Dynamic Effects of Educational Accountability," NBER Working Papers 19915, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:19915
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    1. Raj Chetty & John N. Friedman & Jonah E. Rockoff, 2011. "The Long-Term Impacts of Teachers: Teacher Value-Added and Student Outcomes in Adulthood," NBER Working Papers 17699, National Bureau of Economic Research, Inc.
    2. Robert Bifulco & Helen F. Ladd, 2006. "The Impacts of Charter Schools on Student Achievement: Evidence from North Carolina," Education Finance and Policy, MIT Press, vol. 1(1), pages 50-90, January.
    3. David J. Cooper, 1999. "Gaming against Managers in Incentive Systems: Experimental Results with Chinese Students and Chinese Managers," American Economic Review, American Economic Association, vol. 89(4), pages 781-804, September.
    4. David P. Baron & David Besanko, 1987. "Commitment and Fairness in a Dynamic Regulatory Relationship," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 54(3), pages 413-436.
    5. Randall Reback & Julie Berry Cullen, 2006. "Tinkering toward accolades: School gaming under a performance accountability system," Working Papers 0601, Barnard College, Department of Economics.
    6. Thomas S. Dee & Brian Jacob, 2011. "The impact of no Child Left Behind on student achievement," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 30(3), pages 418-446, June.
    7. Allen, Douglas W. & Lueck, Dean, 1999. "Searching For Ratchet Effects In Agricultural Contracts," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 24(2), pages 1-17, December.
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    Cited by:

    1. Figlio, D. & Karbownik, K. & Salvanes, K.G., 2016. "Education Research and Administrative Data," Handbook of the Economics of Education,, Elsevier.
    2. Barrera-Osorio, Felipe & Raju, Dhushyanth, 2017. "Teacher performance pay: Experimental evidence from Pakistan," Journal of Public Economics, Elsevier, vol. 148(C), pages 75-91.
    3. Karachiwalla, Naureen & Park, Albert, 2017. "Promotion incentives in the public sector: Evidence from Chinese schools," Journal of Public Economics, Elsevier, vol. 146(C), pages 109-128.

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    More about this item

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects

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