This study was designed to determine the relationship between Florida School Recognition Program (FSRP) participation and adequate yearly progress (AYP) criteria met during school years 2004-2008. It also intended to discover whether schools' socioeconomic status, minority rates, and levels moderated this relationship as well as a difference in average AYP criteria met for schools that maintained FSRP participation and those that do not. The study further sought to determine whether these school characteristics and schools' grades predicted maintenance of participation in the FSRP. A quantitative method, including three statistical analyses, was employed to respond to 6 research questions and test 14 corresponding null hypotheses. Three thousand and seventy-seven schools were identified for data collection and analysis. Six independent variables were defined as school level, average socioeconomic status, average minority rate, average percentage of AYP criteria, aggregate number of years 100% of AYP criteria was met, and average school grade. One dependent variable was defined as aggregate years of FSRP participation. The study found that there was a relationship between participation in the FSRP and AYP criteria met, and school level, socioeconomic status, and minority rate moderated this relationship. While school level and minority rate moderated a difference in average percentage of AYP criteria met in schools that maintained participation in the program and those that did not, socioeconomic status did not. Moreover, all independent variables served as predictors for maintenance of participation in the FSRP. The study found that schools' demographic characteristics influence student achievement and participation in incentive pay programs. Six implications for future research were identified to further explore the FSRP and AYP relationship, the unintended consequences of the No Child Left Behind (NCLB) Act, the appropriateness of incentive pay plans in education, the distribution of FSRP award dollars in schools, and student achievement by school level. Recommendations were to add an AYP criterion to the FSRP, assess the effectiveness of inducement policies in education, and add a provision for program evaluation to the FSRP statute. [The dissertation citations contained here are published with the permission of ProQuest LLC. Further reproduction is prohibited without permission. Copies of dissertations may be obtained by Telephone (800) 1-800-521-0600. Web page: http://www.proquest.com.bibliotheek.ehb.be/en-US/products/dissertations/individuals.shtml.]