MELISSA BLOCK, host:

Across the country, struggling school systems are desperate for good ideas. In Washington, D.C., starting this school year, kids are getting paid if they work hard, behave well, and make good grades. The man behind the idea is a Harvard economist. He's already persuaded several school districts that money can encourage disruptive, unmotivated students to change their ways. NPR's Claudio Sanchez reports.

CLAUDIO SANCHEZ: At Shaw-Garnet-Patterson Middle School, of course students like the idea of getting paid for getting good grades or just showing up. They just can't agree on how much.

Unidentified Girl #1: A lot.

Unidentified Girl #2: A thousand dollars.

SANCHEZ: Well, how much did you say?

Unidentified Boy #1: Two hundred.

Unidentified Boy #2: A thousand.

SANCHEZ: Two hundred.

Unidentified Boy #1: Two hundred, because I got two As.

SANCHEZ: How much money do you think you should be paid for coming to school on time?

Unidentified Boy #1: Fifty.

SANCHEZ: And what do you do with that money?

Unidentified Girl #3: Spend it.

Unidentified Boy #3: I'll spend it on my classes.

Dr. ROLAND FRYER (Professor of Economics, Harvard University): The theory here is to try innovative things that will help children achieve.

SANCHEZ: That's Harvard economist Roland Fryer, whose theory about paying kids to do better in school comes from many years of research and his own sense of desperation.

Dr. FRYER: In our urban centers, we're spending 12,000, 15,000 dollars a kid, and we aren't getting any results. So we must do something.

Mr. BRIAN BETTS (Principal, Shaw-Garnet-Patterson Middle School): The kids think they're all getting Visa cards. That's the first thing I'm trying to squash.

SANCHEZ: Rumors abound, says Principal Brian Betts. But here's how Professor Fryer's program, called Capital Gains, is going to work. Students will receive points for grades, behavior, and attendance. Every point is worth $2. After a student attends 50 classes on time, for example, he can earn one point for every additional class he attends on time. Students also get a point for every additional class in which they're not disruptive, profane, or disrespectful. But most importantly, says Betts, students will earn points for getting good grades. Anything less than a 70 percent on a test or a class assignment will not be rewarded.

Mr. BETTS: You get $1 when you hit a 71 percent. If you have 100 percent, then you get the full amount, which will be $20 there. I mean, you're going to have to work.

SANCHEZ: The most a student can earn during the school year is $1,500. The total cost for the 15 schools participating, $2.7 million. Half will come from the school district, half from a grant from The Broad Foundation. But it's not about the money, says Betts. It's about finding and flipping that switch that will turn struggling students into motivated students.

Mr. BETTS: Every child has a button. Every child has a switch. And it's our job as educators to find it.

SANCHEZ: Betts is talking about kids like Daamantae Brown, 14, a tall, lanky eighth grader, a borderline C student and star athlete with a temper that usually gets him into trouble. Today, one of his teachers had to call his mother about it. So Betts pulls him aside.

Mr. BETTS: What's this I hear about Ms. Thigpen (ph) calling your mama?

Mr. DAAMANTAE BROWN (Student, Shaw/Garnet-Patterson Middle School): Yeah, I know.

Mr. BETTS: Did you lose your mind today in math? Maybe a little?

Mr. BROWN: Yeah.

Mr. BETTS: OK. Did you find it?

Mr. BROWN: Yeah, I did.

Mr. BETTS: All right. Good. All right. As long as we found it.

SANCHEZ: When Daamantae gets into trouble or his grades drop, he's actually more afraid of being banned from playing football than he is of losing out on a few dollars for good behavior. Still, Daamantae says most students will behave as long as the money lasts.

Mr. BROWN: If the bad students, if they was acting up before this, then after it's done, they're going to act the same.

SANCHEZ: Discipline, though, is not the biggest problem at this school. Only four out of 10 students here read at grade level. So is there any evidence that a few dollars will entice students to improve their reading skills?

Dr. FRYER: We don't have any data yet.

SANCHEZ: Again, Harvard economist Roland Fryer.

Dr. FRYER: But all of the programs that I have designed have a treatment group, have a control group for statistical comparison. I don't think we should take a stand right now on whether or not we think it's going to work or not. Let's just let the data speak.

SANCHEZ: Fryer's idea is misguided, says Sol Stern, a senior fellow at the Manhattan Institute, a think tank in New York City.

Mr. SOL STERN (Senior Fellow, Manhattan Institute): It's a bribe to kids, and it's racist. It's in effect saying to the black community, look, you parents, we know you can't control your kids, you can't institute the right values in your kids, so basically we're just going to pay you off. Are we really that desperate where we'll literally try anything on kids?

Dr. FRYER: That's just ridiculous. I mean, the real subtle racism here, frankly, is the fact that we're continuing to do the same things we've always done, and we're allowing these children not to achieve.

SANCHEZ: Even if it's a long shot, teachers and administrators at Shaw/Garnet-Patterson Middle School seem to think it's worth trying.

(Soundbite of teachers' meeting)

SANCHEZ: At this meeting, teachers are learning how to log every point a student earns. It's more paperwork, but that's not what bothers social studies teacher Kimberley Khohler.

Ms. KIMBERLEY KHOHLER (Social Studies Teacher, Shaw/Garnet-Patterson Middle School): A lot of my students, their behavior, their lack of motivation for schoolwork, it is almost directly attributed to their parental involvement.

SANCHEZ: Parents who keep their kids focused on school, says Khohler. That's what motivates kids in the long run. It's Friday, and the first parent-teacher conference of the year has attracted about 70 parents. Nikisha Mathews is one of them. She's skeptical about using money to motivate her son.

Ms. NIKISHA MATHEWS: I don't think he should have to be paid to go to school or to perform well in school. I don't think they should have to be paid. But, you know, if that's what they think is going to work, I guess they have to try different things.

SANCHEZ: Mathews turns to her son, Taylor, a seventh grader, and asks him point blank....

Ms. MATHEWS: Are you making any improvement because you want the money? No.

SANCHEZ: Parents can opt out of the program. But so far, no one has. The money students earn will go into their own direct deposit accounts at a local bank. And once kids begin comparing how much they've earned, Principal Brian Betts says he'll know if this pay-to-behave approach is a good idea. If it's not...

Mr. BETTS: Then we move on to something else.

SANCHEZ: Claudio Sanchez, NPR News.

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