Welfare Reform on the Web (August 2004): Education - Overseas

DOES MERIT PAY REWARD GOOD TEACHERS? EVIDENCE FROM A RANDOMIZED EXPERIMENT

T.S. Dee and B.J. Keys

Journal of Policy Analysis and Management, vol.23, 2004, p.471-488

A common criticism of performance-related pay for teachers is that it fails to systematically target rewards on the most effective. Study presents new evidence on this issue by evaluating data from the now defunct Tennessee Career Ladder Evaluation System and the Project STAR class-size experiment. Results show that Tennessee's career ladder had some success in rewarding teachers who improved student attainment. Assignment to career ladder teachers increased students' mathematics scores by about 3%, but generally had smaller and statistically insignificant effects on reading scores.