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Risky business: an analysis of teacher risk preferences

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  • Daniel H. Bowen
  • Stuart Buck
  • Cary Deck
  • Jonathan N. Mills
  • James V. Shuls

Abstract

A range of proposals aim to reform teacher compensation, recruitment, and retention. Teachers have generally not embraced these policies. One potential explanation for their objections is that teachers are relatively risk averse. We examine this hypothesis using a risk-elicitation task common to experimental economics. By comparing preferences of new teachers with those entering other professions, we find that individuals choosing to teach are significantly more risk averse. This suggests that the teaching profession may attract individuals who are less amenable to certain reforms. Policy-makers should take into account teacher risk characteristics when considering reforms that may clash with preferences.

Suggested Citation

  • Daniel H. Bowen & Stuart Buck & Cary Deck & Jonathan N. Mills & James V. Shuls, 2015. "Risky business: an analysis of teacher risk preferences," Education Economics, Taylor & Francis Journals, vol. 23(4), pages 470-480, August.
    • Handle: RePEc:taf:edecon:v:23:y:2015:i:4:p:470-480
    DOI: 10.1080/09645292.2014.966062
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    Cited by:

    1. Kraft, Matthew A. & Brunner, Eric J. & Dougherty, Shaun M. & Schwegman, David J., 2020. "Teacher accountability reforms and the supply and quality of new teachers," Journal of Public Economics, Elsevier, vol. 188(C).
    2. E. Jason Baron, 2019. "Union Reform, Performance Pay, and New Teacher Supply: Evidence from Wisconsin's Act 10," Working Papers wp2019_01_01, Department of Economics, Florida State University.

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