Using 641 principles of economics students across four universities, the authors examine whether providing monetary incentives in a prisoner's dilemma game enhances student learning as measured by a set of common exam questions. Subjects either play a two-player prisoner's dilemma game for real money, play the same game with no money at stake (i.e., play a hypothetical version), or are in a control group where no game is played. The authors find strong evidence that students who played the classroom game for real money earned higher test scores than students who played the hypothetical game or where no game was played. Their findings challenge the conventional wisdom that monetary incentives are unnecessary in classroom experiments.
I hit a point where it would have made sense to hire an employee part-time if I could have paid her hourly and kept zero or minimal records. But I knew enough about the law to know that that could get me in trouble.
