IDEAS home Printed from https://ideas.repec.org/a/tpr/restat/v97y2015i2p364-386.html
   My bibliography  Save this article

Incentive Strength and Teacher Productivity: Evidence from a Group-Based Teacher Incentive Pay System

Author

Listed:
  • Scott A. Imberman

    (Michigan State University and NBER)

  • Michael F. Lovenheim

    (Cornell University and NBER)

Abstract

We estimate the impact of incentive strength on achievement under a group-based teacher incentive pay program. The system provides variation in the share of students in a subject-grade that a teacher instructs, which proxies for incentive strength. We find that achievement on incentivized exams, but not nonincentivized exams, improves when incentives strengthen. For the incentivized exams, we find that effects fade out monotonically as a teacher's portion of the group increases to between 20 and 30 percentage and are larger for teachers with low-achieving students. Calculations based off these estimates show modest positive effects of the program overall. © 2015 The President and Fellows of Harvard College and the Massachusetts Institute of Technology

Suggested Citation

  • Scott A. Imberman & Michael F. Lovenheim, 2015. "Incentive Strength and Teacher Productivity: Evidence from a Group-Based Teacher Incentive Pay System," The Review of Economics and Statistics, MIT Press, vol. 97(2), pages 364-386, May.
    • Handle: RePEc:tpr:restat:v:97:y:2015:i:2:p:364-386
    as

    Download full text from publisher

    File URL: http://www.mitpressjournals.org/doi/pdf/10.1162/REST_a_00486
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Lazear, Edward P & Rosen, Sherwin, 1981. "Rank-Order Tournaments as Optimum Labor Contracts," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 841-864, October.
    2. Erik Hanushek & Stephen Machin & Ludger Woessmann (ed.), 2011. "Handbook of the Economics of Education," Handbook of the Economics of Education, Elsevier, edition 1, volume 4, number 4, June.
    3. Barton H. Hamilton & Jack A. Nickerson & Hideo Owan, 2003. "Team Incentives and Worker Heterogeneity: An Empirical Analysis of the Impact of Teams on Productivity and Participation," Journal of Political Economy, University of Chicago Press, vol. 111(3), pages 465-497, June.
    4. Neal, Derek, 2011. "The Design of Performance Pay in Education," Handbook of the Economics of Education, in: Erik Hanushek & Stephen Machin & Ludger Woessmann (ed.), Handbook of the Economics of Education, edition 1, volume 4, chapter 0, pages 495-550, Elsevier.
    5. Canice Prendergast, 1999. "The Provision of Incentives in Firms," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 7-63, March.
    6. Bengt Holmstrom, 1982. "Moral Hazard in Teams," Bell Journal of Economics, The RAND Corporation, vol. 13(2), pages 324-340, Autumn.
    7. Brian A. Jacob & Steven D. Levitt, 2003. "Rotten Apples: An Investigation of the Prevalence and Predictors of Teacher Cheating," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(3), pages 843-877.
    8. Roland Fryer & Steven Levitt & John List & Sally Sadoff, 2012. "Enhancing the Efficacy of Teacher Incentives through Loss Aversion: A Field Experiment," Framed Field Experiments 00591, The Field Experiments Website.
    9. Leibowitz, Arleen & Tollison, Robert, 1980. "Free Riding, Shirking, and Team Production in Legal Partnerships," Economic Inquiry, Western Economic Association International, vol. 18(3), pages 380-394, July.
    10. Roland G. Fryer, 2011. "Teacher Incentives and Student Achievement: Evidence from New York City Public Schools," NBER Working Papers 16850, National Bureau of Economic Research, Inc.
    11. Ladd, Helen F., 1999. "The Dallas school accountability and incentive program: an evaluation of its impacts on student outcomes," Economics of Education Review, Elsevier, vol. 18(1), pages 1-16, February.
    12. Karthik Muralidharan & Venkatesh Sundararaman, 2011. "Teacher Performance Pay: Experimental Evidence from India," Journal of Political Economy, University of Chicago Press, vol. 119(1), pages 39-77.
    13. C. Kirabo Jackson, 2012. "Do College-Prep Programs Improve Long-Term Outcomes?," NBER Working Papers 17859, National Bureau of Economic Research, Inc.
    14. Derek Neal, 2011. "The Design of Performance Pay in Education," NBER Working Papers 16710, National Bureau of Economic Research, Inc.
    15. C. Kirabo Jackson, 2010. "A Little Now for a Lot Later: A Look at a Texas Advanced Placement Incentive Program," Journal of Human Resources, University of Wisconsin Press, vol. 45(3).
    16. Gaynor, Martin & Pauly, Mark V, 1990. "Compensation and Productive Efficiency of Partnerships: Evidence from Medical Group Practice," Journal of Political Economy, University of Chicago Press, vol. 98(3), pages 544-573, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Evan Riehl & Meredith Welch, 2023. "Accountability, Test Prep Incentives, and the Design of Math and English Exams," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 42(1), pages 60-96, January.
    2. Gibbons, Stephen & Silva, Olmo & Weinhardt, Felix, 2017. "Neighbourhood Turnover and Teenage Attainment," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 15(4), pages 746-783.
    3. Figlio, D. & Karbownik, K. & Salvanes, K.G., 2016. "Education Research and Administrative Data," Handbook of the Economics of Education,, Elsevier.
    4. Nirav Mehta, 2022. "A Partial Identification Approach to Identifying the Determinants of Human Capital Accumulation: An Application to Teachers," University of Western Ontario, Departmental Research Report Series 20221, University of Western Ontario, Department of Economics.
    5. Alejandro J. Ganimian & Richard J. Murnane, 2014. "Improving Educational Outcomes in Developing Countries: Lessons from Rigorous Impact Evaluations," NBER Working Papers 20284, National Bureau of Economic Research, Inc.
    6. Timothy Bond & Kevin Mumford, 2017. "Teacher Performance Pay in the United States: Incidence and Adult Outcomes," Purdue University Economics Working Papers 1289, Purdue University, Department of Economics.
    7. Mehta, Nirav, 2018. "The potential output gains from using optimal teacher incentives: An illustrative calibration of a hidden action model," Economics of Education Review, Elsevier, vol. 66(C), pages 67-72.
    8. Audra Bowlus & Eda Bozkurt & Lance Lochner & Chris Robinson, 2017. "Wages and Employment: The Canonical Model Revisited," NBER Working Papers 24069, National Bureau of Economic Research, Inc.
    9. Barrera-Osorio, Felipe & Raju, Dhushyanth, 2017. "Teacher performance pay: Experimental evidence from Pakistan," Journal of Public Economics, Elsevier, vol. 148(C), pages 75-91.
    10. Andrea Lepine, 2016. "Teacher Incentives and Student Performance: Evidence from Brazil," Working Papers, Department of Economics 2016_18, University of São Paulo (FEA-USP).
    11. Cotofan, Maria, 2021. "Learning from praise: Evidence from a field experiment with teachers," Journal of Public Economics, Elsevier, vol. 204(C).
    12. Brehm, Margaret & Imberman, Scott A. & Lovenheim, Michael F., 2017. "Achievement effects of individual performance incentives in a teacher merit pay tournament," Labour Economics, Elsevier, vol. 44(C), pages 133-150.
    13. Hanley Chiang & Cecilia Speroni & Mariesa Herrmann & Kristin Hallgren & Paul Burkander & Alison Wellington, "undated". "Evaluation of the Teacher Incentive Fund: Final Report on Implementation and Impacts of Pay-for-Performance Across Four Years," Mathematica Policy Research Reports 568955b06a2a4b11b954dded8, Mathematica Policy Research.
    14. Julie Berry Cullen & Cory Koedel & Eric Parsons, 2021. "The Compositional Effect of Rigorous Teacher Evaluation on Workforce Quality," Education Finance and Policy, MIT Press, vol. 16(1), pages 7-41, Winter.
    15. Johnston, Andrew C., 2021. "Preferences, Selection, and the Structure of Teacher Pay," IZA Discussion Papers 14831, Institute of Labor Economics (IZA).
    16. Pope, Nolan G., 2019. "The effect of teacher ratings on teacher performance," Journal of Public Economics, Elsevier, vol. 172(C), pages 84-110.
    17. Yim, Hyejin & Katare, Bhagyashree & Cuffey, Joel, 2022. "Does Increasing Minimum Wage Impact Service Quality? Evidence from Restaurant Food Safety Inspections," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322411, Agricultural and Applied Economics Association.
    18. Alison Wellington & Hanley Chiang & Kristin Hallgren & Cecilia Speroni & Mariesa Herrmann & Paul Burkander, "undated". "Evaluation of the Teacher Incentive Fund: Implementation and Impacts of Pay-for-Performance After Three Years (Final Report)," Mathematica Policy Research Reports c01a81e283374843b1d4b39ce, Mathematica Policy Research.
    19. Hugh Macartney & Robert McMillan & Uros Petronijevic, 2018. "Teacher Value-Added and Economic Agency," NBER Working Papers 24747, National Bureau of Economic Research, Inc.
    20. Dahal,Mahesh & Nguyen,Quynh T., 2014. "Private non-state sector engagement in the provision of educational services at the primary and secondary levels in South Asia : an analytical review of its role in school enrollment and student achie," Policy Research Working Paper Series 6899, The World Bank.
    21. Cotofan, Maria, 2021. "Learning from praise: evidence from a field experiment with teachers," LSE Research Online Documents on Economics 112772, London School of Economics and Political Science, LSE Library.
    22. Berlinski, Samuel & Ramos, Alejandra, 2020. "Teacher mobility and merit pay: Evidence from a voluntary public award program," Journal of Public Economics, Elsevier, vol. 186(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sarena F. Goodman & Lesley J. Turner, 2013. "The Design of Teacher Incentive Pay and Educational Outcomes: Evidence from the New York City Bonus Program," Journal of Labor Economics, University of Chicago Press, vol. 31(2), pages 409-420.
    2. Jones, Michael D., 2013. "Teacher behavior under performance pay incentives," Economics of Education Review, Elsevier, vol. 37(C), pages 148-164.
    3. Barrera-Osorio, Felipe & Raju, Dhushyanth, 2017. "Teacher performance pay: Experimental evidence from Pakistan," Journal of Public Economics, Elsevier, vol. 148(C), pages 75-91.
    4. Karthik Muralidharan & Venkatesh Sundararaman, 2011. "Teacher Performance Pay: Experimental Evidence from India," Journal of Political Economy, University of Chicago Press, vol. 119(1), pages 39-77.
    5. Isaac Mbiti & Mauricio Romero & Youdi Schipper, 2023. "Designing Effective Teacher Performance Pay Programs: Experimental Evidence from Tanzania," The Economic Journal, Royal Economic Society, vol. 133(653), pages 1968-2000.
    6. Victor Lavy, 2009. "Performance Pay and Teachers' Effort, Productivity, and Grading Ethics," American Economic Review, American Economic Association, vol. 99(5), pages 1979-2011, December.
    7. Brehm, Margaret & Imberman, Scott A. & Lovenheim, Michael F., 2017. "Achievement effects of individual performance incentives in a teacher merit pay tournament," Labour Economics, Elsevier, vol. 44(C), pages 133-150.
    8. repec:eee:labchp:v:3:y:1999:i:pb:p:2373-2437 is not listed on IDEAS
    9. Derek Neal, 2011. "The Design of Performance Pay in Education," NBER Working Papers 16710, National Bureau of Economic Research, Inc.
    10. Roland Fryer & Steven Levitt & John List & Sally Sadoff, 2012. "Enhancing the Efficacy of Teacher Incentives through Loss Aversion: A Field Experiment," Framed Field Experiments 00591, The Field Experiments Website.
    11. Scott A. Imberman, 2015. "How effective are financial incentives for teachers?," IZA World of Labor, Institute of Labor Economics (IZA), pages 158-158, June.
    12. Shirin, Farzana, 2023. "Does Teacher Salary Support Improve Student Learning Outcomes," 2023 Annual Meeting, July 23-25, Washington D.C. 335793, Agricultural and Applied Economics Association.
    13. Jesse Rothstein, 2015. "Teacher Quality Policy When Supply Matters," American Economic Review, American Economic Association, vol. 105(1), pages 100-130, January.
    14. Edward P. Lazear, 1995. "Personnel Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262121883, December.
    15. Simon Burgess & Carol Propper & Marisa Ratto & Emma Tominey, 2017. "Incentives in the Public Sector: Evidence from a Government Agency," Economic Journal, Royal Economic Society, vol. 127(605), pages 117-141, October.
    16. Roland G. Fryer, 2013. "Teacher Incentives and Student Achievement: Evidence from New York City Public Schools," Journal of Labor Economics, University of Chicago Press, vol. 31(2), pages 373-407.
    17. Vegas, E & Ganimian, A. J., 2013. "Theory and Evidence on Teacher Policies in Developed and Developing Countries," Working Paper 104291, Harvard University OpenScholar.
    18. De Paola, Maria & Gioia, Francesca & Scoppa, Vincenzo, 2019. "Free-riding and knowledge spillovers in teams: The role of social ties," European Economic Review, Elsevier, vol. 112(C), pages 74-90.
    19. Michael Waldman, 2012. "Theory and Evidence in Internal LaborMarkets [The Handbook of Organizational Economics]," Introductory Chapters,, Princeton University Press.
    20. Timothy Bond & Kevin Mumford, 2017. "Teacher Performance Pay in the United States: Incidence and Adult Outcomes," Purdue University Economics Working Papers 1289, Purdue University, Department of Economics.
    21. Samuel Berlinski & Norbert Schady, 2015. "Daycare Services: It’s All about Quality," Palgrave Macmillan Books, in: Samuel Berlinski & Norbert Schady (ed.), The Early Years, chapter 4, pages 91-119, Palgrave Macmillan.

    More about this item

    Keywords

    incentive strength; achievement; teacher; pay program; incentivized exams; nonincentivized exams; monotonically;
    All these keywords.

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I20 - Health, Education, and Welfare - - Education - - - General
    • H00 - Public Economics - - General - - - General
    • J00 - Labor and Demographic Economics - - General - - - General
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:tpr:restat:v:97:y:2015:i:2:p:364-386. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Kelly McDougall (email available below). General contact details of provider: https://direct.mit.edu/journals .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.