July 2008

IZA DP No. 3599: Should You Compete or Cooperate with Your Schoolmates?

revised version published in: Education Economics, 2011, 19 (3), 275-289

Building upon some education studies finding that cooperative behaviour in class yields better achievements among students, this paper presents a simple model showing that free riding incentives lead to an insufficient degree of cooperation between schoolmates, which in turn decreases the overall achievement. A cooperative learning approach may instead emerge when competitive behaviour is negatively evaluated by schoolmates, especially when the class is more homogeneous in terms of students’ characteristics (e.g., ability). Empirical evidence supporting our model is found using the 2003 wave of the OECD Programme for International Student Assessment (PISA) survey on students’ literacy levels. A competitive learning approach has a positive individual return (higher in comprehensive educational systems), while student performance increases with the average cooperative behaviour, particularly in tracked educational systems.