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Testing implications of a tournament model of school district salary schedules

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  • Heutel, Garth

Abstract

Using panel data on the salary schedules of public school teachers and administrators, I look for evidence of a tournament wage structure. A tournament model is presented, where teachers compete for promotion to administrators. Districts can create incentives for teachers by offering either a higher pay premium for promotion or a larger probability of promotion. The model predicts an inverse relationship between these two values. Evidence supporting this prediction is found in the data. In contrast, an alternative model of incentive pay, where returns to seniority substitute for imperfect monitoring, is not supported empirically. This result is consistent with intuition that tenure protections make it hard for districts to fire shirking teachers, making returns to seniority a poor method of providing incentives.

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Bibliographic Info

Article provided by Elsevier in its journal Economics of Education Review.

Volume (Year): 28 (2009)
Issue (Month): 1 (February)
Pages: 143-151

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Handle: RePEc:eee:ecoedu:v:28:y:2009:i:1:p:143-151

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Web page: http://www.elsevier.com/locate/econedurev

Related research

Keywords: Teacher salaries Efficiency Educational finance Salary wage differentials;

References

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  1. Victor Lavy, 2002. "Evaluating the Effect of Teachers' Group Performance Incentives on Pupil Achievement," Journal of Political Economy, University of Chicago Press, vol. 110(6), pages 1286-1317, December.
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  13. Gates, Susan M. & Ringel, Jeanne S. & Santibanez, Lucrecia & Guarino, Cassandra & Ghosh-Dastidar, Bonnie & Brown, Abigail, 2006. "Mobility and turnover among school principals," Economics of Education Review, Elsevier, vol. 25(3), pages 289-302, June.
  14. Lazear, Edward P, 1979. "Why Is There Mandatory Retirement?," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1261-84, December.
  15. Eric A. Hanushek & EJohn F. Kain & Steven G. Rivkin, 2004. "Why Public Schools Lose Teachers," Journal of Human Resources, University of Wisconsin Press, vol. 39(2).
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  17. Lazear, Edward P, 1981. "Agency, Earnings Profiles, Productivity, and Hours Restrictions," American Economic Review, American Economic Association, vol. 71(4), pages 606-20, September.
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Cited by:
  1. Gilpin, Gregory A., 2012. "Teacher salaries and teacher aptitude: An analysis using quantile regressions," Economics of Education Review, Elsevier, vol. 31(3), pages 15-29.

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