Do Higher Salaries Buy Better Teachers?

53 Pages Posted: 25 Apr 1999 Last revised: 17 Sep 2001

See all articles by Eric A. Hanushek

Eric A. Hanushek

Stanford University - Hoover Institution on War, Revolution and Peace; National Bureau of Economic Research (NBER); CESifo (Center for Economic Studies and Ifo Institute)

John F. Kain

University of Texas at Dallas - Cecil and Ida Green Center for the Study of Science and Society

Steven G. Rivkin

Amherst College - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: April 1999

Abstract

Important policy decisions rest on the relationship between teacher salaries and the quality of teachers, but the evidence about the strength of any such relationship is thin. This paper relies upon the matched panel data of the UTD Texas School Project to investigate how shifts in salary schedules affect the composition of teachers within a district. The panel data permit separation of shifts in salary schedules from movement along given schedules, and thus the analysis is much more closely related to existing policy proposals. In analyses both of teacher mobility and of student performance, teacher salaries are shown to have a modest impact. Teacher mobility is more affected by characteristics of the students (income, race, and achievement) than by salary schedules. Salaries are also weakly related to performance on teacher certification tests appearing to be relevant only in districts doing high levels of hiring, but preliminary examination shows that the certification tests are not significantly related to student achievement. The only significant relationship between salaries and student achievement holds (implausibly) for existing experienced teachers and not for new hires or for probationary teachers.

Suggested Citation

Hanushek, Eric A. and Kain, John F. and Rivkin, Steven G., Do Higher Salaries Buy Better Teachers? (April 1999). NBER Working Paper No. w7082. Available at SSRN: https://ssrn.com/abstract=160673

Eric A. Hanushek (Contact Author)

Stanford University - Hoover Institution on War, Revolution and Peace ( email )

Stanford, CA 94305-6010
United States
650-736-0942 (Phone)
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National Bureau of Economic Research (NBER)

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CESifo (Center for Economic Studies and Ifo Institute)

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John F. Kain

University of Texas at Dallas - Cecil and Ida Green Center for the Study of Science and Society ( email )

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United States
(972) 883-2555 (Phone)
(972) 883-2551 (Fax)

Steven G. Rivkin

Amherst College - Department of Economics ( email )

P.O. Box 5000
Amherst, MA 01002-5000
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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