Pay by Design: Teacher Performance Pay Design and the Distribution of Student Achievement
47 Pages Posted: 7 May 2016 Last revised: 26 Dec 2016
Date Written: October 16, 2016
We present results of a randomized trial testing alternative approaches of mapping student achievement into rewards for teachers. Teachers in 216 schools in western China were assigned to performance pay schemes where teacher performance was assessed by one of three different methods. We find that teachers offered “pay-for-percentile” incentives (Barlevy and Neal 2012) outperform teachers offered simpler schemes based on class average achievement or average gains over a school year. Moreover, pay-for-percentile incentives produced broad-based gains across students within classes. That teachers respond to relatively intricate features of incentive schemes highlights the importance of close attention to performance pay design.
Keywords: Teacher Performance Pay, Incentive Design, Distributional Effects
JEL Classification: I21, J33, M52
Suggested Citation: Suggested Citation