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Teacher labor markets and the perils of using hedonics to estimate compensating differentials in the public sector

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  • Goldhaber, Dan
  • Destler, Katharine
  • Player, Daniel
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    Abstract

    Some scholars and policymakers who are concerned about the inequitable distribution of quality teachers suggest offering financial incentives for working in hard-to-staff schools. Previous studies have estimated compensating differentials using hedonic modeling, an approach potentially undermined by district-wide salary schedules and the lack of labor market competitiveness. To address this problem, we build hedonic wage models for both public and private schools using data from the 1999-2000 Schools and Staffing Survey and the 2000 Census. Empirical estimates suggest that both public and private schools compensate teachers for some working conditions, but there also appear to be differences between public and private schools in the magnitude of the compensating differentials, particularly for teaching low-income students.

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    Bibliographic Info

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

    Volume (Year): 29 (2010)
    Issue (Month): 1 (February)
    Pages: 1-17

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    Handle: RePEc:eee:ecoedu:v:29:y:2010:i:1:p:1-17

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

    Related research

    Keywords: Salary wage differentials Educational economics Educational finance Human capital Teacher salaries;

    References

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    1. Richard Vedder & Joshua Hall, 2000. "Private School Competition and Public School Teacher Salaries," Journal of Labor Research, Transaction Publishers, Transaction Publishers, vol. 21(1), pages 162-168, January.
    2. Ehrenberg, Ronald G. & Brewer, Dominic J., 1994. "Do school and teacher characteristics matter? Evidence from High School and Beyond," Economics of Education Review, Elsevier, Elsevier, vol. 13(1), pages 1-17, March.
    3. Hwang, Hae-shin & Reed, W Robert & Hubbard, Carlton, 1992. "Compensating Wage Differentials and Unobserved Productivity," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 100(4), pages 835-58, August.
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    5. Jay G. Chambers, 1978. "Educational Cost Differentials and the Allocation of State Aid for Elementary/Secondary Education," Journal of Human Resources, University of Wisconsin Press, vol. 13(4), pages 459-481.
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    7. Greenwood, Michael J, et al, 1991. "Migration, Regional Equilibrium, and the Estimation of Compensating Differentials," American Economic Review, American Economic Association, vol. 81(5), pages 1382-90, December.
    8. C. Kirabo Jackson, 2009. "Student Demographics, Teacher Sorting, and Teacher Quality: Evidence from the End of School Desegregation," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 27(2), pages 213-256, 04.
    9. Thomas S. Dee, 2001. "Teachers, Race and Student Achievement in a Randomized Experiment," NBER Working Papers 8432, National Bureau of Economic Research, Inc.
    10. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4 National Bureau of Economic Research, Inc.
    11. Eric A. Hanushek & John F. Kain & Steven G. Rivkin & Daniel M. O'Brien, 2005. "The Market for Teacher Quality," Discussion Papers, Stanford Institute for Economic Policy Research 04-025, Stanford Institute for Economic Policy Research.
    12. Venkataraman Bhaskar & Ted To, 1999. "Oligopsony and the Distribution of Wages," CIRJE F-Series CIRJE-F-42, CIRJE, Faculty of Economics, University of Tokyo.
    13. Levinson, Arik M., 1988. "Reexamining teacher preferences and compensating wages," Economics of Education Review, Elsevier, Elsevier, vol. 7(3), pages 357-364, June.
    14. Donald Boyd & Hamilton Lankford & Susanna Loeb & James Wyckoff, 2003. "Analyzing the Determinants of the Matching Public School Teachers to Jobs: Estimating Compensating Differentials in Imperfect Labor Markets," NBER Working Papers 9878, National Bureau of Economic Research, Inc.
    15. Benjamin Scafidi & David L. Sjoquist & Todd R. Stinebrickner, 2005. "Race, Poverty, and Teacher Mobility," University of Western Ontario, CIBC Centre for Human Capital and Productivity Working Papers, University of Western Ontario, CIBC Centre for Human Capital and Productivity 20053, University of Western Ontario, CIBC Centre for Human Capital and Productivity.
    16. Alan Manning & Ted To, 2002. "Oligopsony and Monopsonistic Competition in Labor Markets," Journal of Economic Perspectives, American Economic Association, vol. 16(2), pages 155-174, Spring.
    17. Dale Ballou & Michael Podgursky, 1998. "Teacher recruitment and retention in public and private schools," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 17(3), pages 393-417.
    18. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1, January.
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