NCPA - National Center for Policy Analysis


March 5, 2007

Offering higher salaries to teachers in certain subject areas, or in the most disadvantaged schools within a district, can be an effective tool for convincing teachers to take jobs that they would not otherwise consider, according to a National Bureau of Economic Research (NBER) study.

The researchers focused on a North Carolina program that awarded an annual $1,800 bonus to science, math and special education teachers working in high poverty or academically struggling public secondary schools.  They found:

  • Overall, the data suggest that teachers who received bonus payments were 10 percent less likely to depart at the end of the school year than other teachers at the same school.
  • As a rough rule of thumb, the authors calculate that their data show that a $100 increase in the bonus reduces the probability of departure by approximately 1 percent.

Further, the response varied with certain teacher characteristics:

  • High school teachers were apparently unaffected by the program.
  • Middle school teachers, who had a higher likelihood of departure than high school teachers, were strongly affected.
  • Middle school teachers receiving a bonus payment were 27 percent less likely to leave.
  • Math teachers receiving the bonus were 18 percent less likely to depart the following year.

The program did have its shortcomings, however.  For example, teachers were not well informed about the provisions and the program ended early.  But overall, the researchers conclude that the program bodes well for programs designed to target permanent salary differentials to certain types of teachers in needy schools.

Source: Linda Gorman, "Would Higher Salaries Keep Teachers in High-Poverty Schools?" NBER Digest, February 2007; based upon: Charles Clotfelter, et al., "Would Higher Salaries Keep Teachers in High-Poverty Schools?" NBER Working Paper No. 12285, June 2006.

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