1 The Impact of Financial Incentives on Academic Achievement and Household Behavior: Evidence from a Randomized Trial in Nepal

Ohio State University. This project would not have been possible without the cooperation of principals, teachers, parents, and students in the sample schools. I am especially indebted to my advisor Dr. Brian Roe for his guidance, support, and encouragement throughout the process. 2 We present evidence on the impact of piece rate financial incentives on students ’ school outcomes from a randomized field experiment in Nepal. Despite several experimental and institutional factors making it less likely of finding a positive treatment effect, I find that incentives increase average aggregate scores by 0.09 standard deviations. The bulk of the aggregate gain is constituted of large gains in two subjects with relatively high baseline scores. There is no noticeable difference in gains between males and females and incentives have a relatively higher impact on students from higher socioeconomic strata and the lower quartiles. My study contributes to the growing literature on short term impact of academic incentives by recording household response to the incentives. I show that the proportion of students who received help with schoolwork at home, either from a hired tutor or a household member, increased among the subgroups that exhibit the most gains in scores. Finally, financial rewards do not have an adverse impact on students ’ intrinsic motivation to learn