An Analysis of Merit Pay Reforms in Educational Institutions

With roots in behaviorist philosophy, performance pay for teachers is often linked to accountability regimes in school reform. The theory girding such programs suggests that pay as an economic incentive can help cause teachers to increase student outcomes as measured by standardized test scores. What is little noticed by many educationists, but particularly by policy makers, is how programmatic effects affect the ontology of educational environment. There are several ways to approach the viability of such programs. In this study of three pay-for-performance programs, two in the U.S. and one in the UK, we provide theoretic insights in light of three variables: (i) their psychological framework, (ii) teacher efficacy and the teacher-student relationship, and (iii) how the psychological impact of such programs coincides with larger institutional forces. Using theory to examine pay-for-performance is necessary in order to get beneath mere data and secure more thorough understandings of the phenomenological impacts of performance pay. And better understanding of these foundational features is necessary, even critical, in order to fully appreciate the economic and informational trade-offs in implementation. Our study suggests that as a small-scale reform measure and when it specifically accounts for complexities of educational production, performance pay may be a viable reform option.