> the more people are rewarded, the more they come to lose interest in
> whatever had to be done in order to get the reward. 
> It sounds like they are saying that incentives don't matter.
> Cyril Morong> 

To the extent this is the case with grades, it does not imply that
incentives do not matter.  The incentive can be, instead of grades, a
desire to learn or interest in the subject.  The implication is that a
multiplicity of incentives can sometimes be detrimental, as one incentive
crowds out another.  I can see that in excessive emphasis on grading, a
goal of getting high grades on tests can make the class and subject less
pleasant, hence crowd out the incentive due to interest in the subject.

This is not necessarily and always the case, though, since very good
students interested in the subject will get the good scores as an
incidental result of wanting to learn the material anyway.

Fred Foldvary

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