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Performance pay for teachers: Determinants and consequences

  • Belfield, Clive R.
  • Heywood, John S.

Theory and evidence on performance-related pay for teaching remain inconclusive. Teachers will respond to rewards, but an appropriate reward structure may not be devised because education is a collaborative endeavor. Here we test three hypotheses: performance-related pay among teachers is more likely to be observed when there are evident indicators of team production; teachers receiving performance pay will earn more in total than otherwise equal teachers without performance pay; and teachers receiving performance pay should have higher job satisfaction. We use the Schools and Staffing Survey (2000) to test each hypothesis. Team production does strongly predict performance-related pay, and that such pay does boost earnings, but that job satisfaction is lower for those who receive such pay awards.

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File URL: http://www.sciencedirect.com/science/article/B6VB9-4RM7N32-3/1/3c1d94738f64f541f377d84041610f51
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Article provided by Elsevier in its journal Economics of Education Review.

Volume (Year): 27 (2008)
Issue (Month): 3 (June)
Pages: 243-252

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Handle: RePEc:eee:ecoedu:v:27:y:2008:i:3:p:243-252
Contact details of provider: Web page: http://www.elsevier.com/locate/econedurev

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  1. Goldin, Claudia, 1986. "Monitoring Costs and Occupational Segregation by Sex: A Historical Analysis," Scholarly Articles 2666727, Harvard University Department of Economics.
  2. Edward P. Lazear, 2000. "Performance Pay and Productivity," American Economic Review, American Economic Association, vol. 90(5), pages 1346-1361, December.
  3. John S. Heywood & Uwe Jirjahn, 2002. "Payment schemes and gender in Germany," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 56(1), pages 44-64, October.
  4. Booth, Alison L & Frank, Jeff, 1999. "Earnings, Productivity, and Performance-Related Pay," Journal of Labor Economics, University of Chicago Press, vol. 17(3), pages 447-63, July.
  5. Robert Gibbons, 1998. "Incentives in Organizations," Journal of Economic Perspectives, American Economic Association, vol. 12(4), pages 115-132, Fall.
  6. Clark, Andrew E. & Oswald, Andrew J., 1996. "Satisfaction and comparison income," Journal of Public Economics, Elsevier, vol. 61(3), pages 359-381, September.
  7. Sarah Brown & John G. Sessions, 2003. "Attitudes, Expectations and Sharing," LABOUR, CEIS, vol. 17(4), pages 543-569, December.
  8. Thomas S. Dee & Benjamin J. Keys, 2004. "Does merit pay reward good teachers? Evidence from a randomized experiment," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 23(3), pages 471-488.
  9. Ballou, Dale, 2001. "Pay for performance in public and private schools," Economics of Education Review, Elsevier, vol. 20(1), pages 51-61, February.
  10. Michelle Brown, 2001. "Unequal Pay, Unequal Responses? Pay Referents and their Implications for Pay Level Satisfaction," Journal of Management Studies, Wiley Blackwell, vol. 38(6), pages 879-886, 09.
  11. Bruce Shearer, 2004. "Piece Rates, Fixed Wages and Incentives: Evidence from a Field Experiment," Review of Economic Studies, Wiley Blackwell, vol. 71(2), pages 513-534, 04.
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