The Labor Market for Teachers Under Different Pay Schemes
95 Pages Posted: 2 Apr 2017 Last revised: 5 Aug 2018
Date Written: July 7, 2018
Compensation of most US public school teachers is rigid and solely based on seniority. This paper studies a 2011 reform that gave school districts in Wisconsin full autonomy to redesign teacher pay schemes. I show that, following the reform, some districts switched to flexible compensation and started paying high-quality teachers more. Teacher quality increased in these districts relative to those with seniority pay, due to a change in workforce composition and an increase in effort. I estimate a structural model of this labor market to investigate the effects of alternative pay schemes on the composition of the teaching workforce.
Keywords: Teachers, Salaries, Pay-for-performance, Job Mobility, Unions, Teacher Selection, Teacher Retention
JEL Classification: I20, J31, J45, J51, J61, J63
Suggested Citation: Suggested Citation