What is usually effective for children this age is a combination of both rewards and punishment. For punishment, figure out what works for them. Is it losing items that are important to them, is it losing time socializing with other children, is it going on trips with Mom and Dad to the store/movies/park? My husband tells the story of being a kid and his punishment was that no one in the family could watch tv for a few day, and it was his fault. He was the type of kid that could sit on the floor and have fun with his imagination --didn't need anything. So, none of the typical types of punishments worked. Try your best to figure out what works,and then use that as a punishment.
Additionally, you should try and think of some reward for good behaviour. When the child does act the right way or does the right thing, do you reward them? Even just a compliment can be very helpful. What you might want to think about is some sort of chart that you can track the behaviour on.
In a school I worked in, they used a color chart method. Every day students started out on green. When they started to do something wrong, they would get a warning. If they still continued the behavior, then the card would be changed to yellow, then blue, then red, then no color. For each color, there were some consequence. You could modifiy this, to when they get to blue, they get a three minute time out. Red is a ten minute time out, and no color is a loss of something they care about.
If the child stays on green all day, then that is great. Once they have three, four, or five green days, then they should get some sort of reward--extra tv or computer time, a gift from the store, a special trip with mom or dad. Again, whatever would be incentive for them to work towards that.
Hope this helps,
S.