By Nancy Jeffrey
Updated October 17, 2005 12:00 PM

In her four years at Oldham County High School in Crestwood, Ky., Krystal Brooks missed only five days of classes and earned report cards brimming with A’s and B’s. “I’ve always tried,” says Brooks, “and it paid off.”

And how. At her school’s all-night graduation party last year, Brooks won a bright-yellow 40th-anniversary-edition Ford Mustang with a sticker price of $21,000. Like other students with good grades or attendance, she was allowed to enter a raffle sponsored by a local car dealership. In fact Brooks’s standout record allowed her to enter her name 36 times. “Winning was a shock,” says Brooks, now 19, especially since going to school is something she has always looked forward to. “It just kind of came naturally to me,” she says.

If the gesture seems a bit grandiose, Brooks’s school is in good company. Across the country, schools looking for a way to motivate students are handing out new cars, laptops, iPods—and cold, hard cash. Funded by private donations or sponsored by local businesses, the giveaways usually involve a raffle requiring students to meet certain attendance or grade benchmarks to enter. In Chelsea, Mass., the school district has just launched a cash-bonus program that will allow high school students to earn up to $500 for perfect attendance during their four years. “I have an obligation to do everything in my power to get kids to come to school and stay in school,” says school-committee member Morrie Siegal. He wants to boost the current attendance rate from 90 percent to at least 92 percent—the level inspired by the school under the No Child Left Behind Act. “We have nothing to lose and everything to gain.”

Not everyone agrees. “Is that what we really want to teach kids—that you should expect a reward for doing what you ought to do anyway?” asks Dr. Cecil Reynolds, president of the American Psychological Association’s school-psychology division. Awarding lavish gifts for showing up or getting good marks, he says, is no substitute for good teaching—nor for good old-fashioned parental authority. “One of my ‘incentives’ to go to school was that my dad was a drill instructor in the Marine Corps,” says Reynolds. “You went to school. There was no choice.”

Other experts, however, insist school incentives can work if they’re done right. “They motivate students and get them going,” says Virginia Shiller, a clinical psychologist in New Haven, Conn., and author of Rewards for Kids, a how-to guide for parents. Once the child gets in the groove of showing up, Schiller argues, they will appreciate the other rewards of regular attendance: improved grades, positive feedback from teachers and the satisfaction of doing well.

To be sure, tangible rewards for grades are nothing new. Many of today’s parents happily accepted candy and cash from their own moms and dads for every A they brought home on report-card day (see box). Still, that schools now find it necessary to offer lavish rewards, says Dr. Jeff Bostic, a psychiatrist at Harvard Medical School, is “another nail in the coffin of our ideology that we will learn for the sake of learning.”

Don’t tell that to Fernando Vazquez of Hartford, Conn., whose 9-year-old son, Fernando Jr., won a 2005 Saturn Ion for perfect attendance (he cashed it in for $10,000 to jump-start his college fund). As a reward for his son’s sterling record, Fernando Sr. offered to take the boy to a theme park last summer. But Fernando turned him down, explaining that the day chosen by his father was his last day of class. Says Fernando’s teacher, Victoria Fuchs: “He told his father he wanted to go to school.”

Nancy Jeffrey. Kristen Mascia and John Perra in Washington, D.C., and Tom Duffy in Chelsea.