An average student who excels under the guidance of a teacher who tells him he is smart is benefitting from

Even though the question is a little bit vague, I think that it refers to extrinsic motivation and correct guidance. Extrinsic motivation is any positive reinforcement that comes from the environment, it can be a teacher, a parent, a friend or even things like a painting, a landscape or music. It is most common to receive extrinsic motivation from people thou. Most people need this kind of motivation for they do not have an inner drive that compels them to do the things they have to; this is known as intrinsic motivation.

Extrinsic motivation is something that we all need from time to time, but we should not depend on it for every aspect of our lives. We need to find ways to develop a good internal source of intrinsic motivation.

In this case the student is benefiting from extrinsic motivation from the teacher who encourages him to believe in himself by appraising his capacities and potential.