I guess the hope was then, as it is now in most schools, that the grades or the stickers or the treat would be a motivator for the short term, and that the habit of working hard would lead to internal motivation later. But I'm not sure it works that way for many kids.
When new children come to Parker in about grade 3 and above, we often find that they are not used to being asked to stretch themselves or to do more than the minimum. They have not felt the power of self-motivation - at least not in the classroom.
As Linda Flanagan reports in the latest MindShift, "If you start kids the wrong way — say, by rewarding them with pizza — then their intrinsic motives will vanish."
So, how do we teach internal motivation? At Parker it is a very intentional process. We give students choices that they appreciate: deciding on a book for literature circles or a topic for research. We connect subjects like art, social studies, science and reading as when 4th graders prepare a presentation about honey bees. Or we challenge them in a STEM week to design and build a real bridge, because it's interesting and they get to experience the "why" of things.
We promote autonomy - children need to handle themselves in the classroom and the hallways with a minimum of adult-made rules. And the children help develop the rules, because then they are vested in following them.
We train children in critique. They practice giving useful feedback and doing multiple drafts of a piece of work so that it reaches excellence. Children also help to define what excellence looks like, because then they know what they are striving for. Holding your work up to the evaluation of peers is powerful stuff. Children want to show their friends their best - and that is way more powerful and life-lasting than going for the grade.
One other big motivator for children is in the social element of learning: children are naturally driven to be social. Working with friends and classmates isn't always easy, but it is highly motivating and it reinforces learning. That's why we stress cooperative teams and groups working together on projects or towards a mutual goal.
Intrinsic motivation is probably the most useful trait that children can ever develop. It can't be extracted from a grade.