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Title: Teacher Behavior under Performance Pay Incentives

Citation Type: Working Paper

Publication Year: 2011

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Abstract: Over the last decade many districts have implemented performance pay incentives to reward teachers for improving student test scores. Economic theory suggests that these programs could alter teacher work effort, cooperation, and retention. Because teachers can choose to work in a performance pay district that has characteristics correlated with teacher behavior, I use the distance between a teachers undergraduate institution and the nearest performance pay district as an instrumental variable. Using data from the 2003 and 2007 waves of the Schools and Staffing Survey (SASS), I find that teachers respond to performance pay incentives by working six percent fewer hours per week at school. Performance pay also decreases participation in unpaid cooperative school activities, but it does not increase teacher turnover. The treatment effects are heterogeneous; male teachers respond more positively to performance pay than female teachers. Using Florida as a case study, I find that individual-level incentives appear to increase teacher effort and turnover compared to school-level incentives.

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Authors: Jones, Michael

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Institution: University of Notre Dame

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Data Collections: IPUMS CPS

Topics: Education, Other

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