Incentives for students: effects of certificates and deadlines on student performance

Abstract

This study examines the effects of certificates and deadlines on student performance. It exploits time lags in reforms of two similar degree programs at a business school, which create quasi-experimental settings. Students’ performance is found to increase if certificates are awarded to them early in their program. Deadlines to pass exams prevent them from submitting blank sheets to fail and resit exams. Both effects are stronger among average students compared to high-ability or low-ability students. These findings show that the policies that govern degree programs can create incentives for students to improve performance. It is important for universities to understand the behavioral implications of such policies when designing degree programs.