This collection contains three studies of the relationship between incentives, learning, and employability. The first study, "Incentives, Learning, and Employability," by John Bishop, models students' choices concerning what to learn and how much effort to spend learning it in terms of the outcome of a comparison of benefits and expected costs and examines various strategies for use in increasing student motivation to learn. The second paper, "A Formal Model of School Reward Systems" by Suk Kang, examines pass-fail and graduated reward systems. The third paper, "The Design of Handicapping Systems for Rewarding Learning: A Mathematical Analysis of Intertemporal Issues" by John Bishop and Charles Wilson, examines alternative reward systems, a model of behavior, measures of cost-effectiveness, and student response to different reward systems. Appendixes to the third paper include the handicapping model and a discussion of the formulas used in the study; appendixes to the overall report include notes on the observational data collection procedure used, a discussion of the fair distribution rule in a cooperative enterprise, and an examination of the relationship between incentive schemes and effort level by the agents in a cooperative enterprise. (MN)