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Teacher Quality and Incentives: Theoretical and Empirical Effects of Standards on Teacher Quality

  • Hendrik Jürges
  • Wolfram F. Richter
  • Kerstin Schneider

Applying the theory of yardstick competition to the schooling system, we show that it is optimal to have central tests of student achievement and to engage in benchmarking because it raises the quality of teaching. This is true even if teachers’ pay (defined in monetary terms) is not performance related. If teachers value reputation, and if teaching output is measured so that it becomes comparable, teachers will increase their effort. The theory is tested using the German PISA-E data. Our estimates suggest that, despite the flat career profile of German teachers, the quality of teaching tends to be higher in federal states with central exams.

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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 1296.

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Date of creation: 2004
Date of revision:
Handle: RePEc:ces:ceswps:_1296
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  1. Effinger, M.R. & Polborn, M.K., 1997. "A Model of Vertically Differenciated Education," Papers 97.469, Toulouse - GREMAQ.
  2. Hendrik Jürges & Kerstin Schneider, 2004. "International Differences in Student Achievement: An Economic Perspective," German Economic Review, Verein für Socialpolitik, vol. 5(3), pages 357-380, 08.
  3. Victor Lavy, 2004. "Performance Pay and Teachers' Effort, Productivity and Grading Ethics," NBER Working Papers 10622, National Bureau of Economic Research, Inc.
  4. Mark Armstrong & Simon Cowan & John Vickers, 1994. "Regulatory Reform: Economic Analysis and British Experience," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262510790, June.
  5. Wößmann, Ludger, 2002. "Central Exams Improve Educational Performance: International Evidence," Kiel Discussion Papers 397, Kiel Institute for the World Economy (IfW).
  6. Angrist, Joshua & Guryan, Jonathan, 2005. "Does Teacher Testing Raise Teacher Quality? Evidence from State Certification Requirements," IZA Discussion Papers 1500, Institute for the Study of Labor (IZA).
  7. Bishop, J., 1997. "The Effect of national Standards and Curriculum-Based Exams on Achievement," Papers 97-01, Cornell - Center for Advanced Human Resource Studies.
  8. Paul Glewwe & Nauman Ilias & Michael Kremer, 2010. "Teacher Incentives," American Economic Journal: Applied Economics, American Economic Association, vol. 2(3), pages 205-27, July.
  9. Bishop, John H, 1997. "The Effect of National Standards and Curriculum-Based Exams on Achievement," American Economic Review, American Economic Association, vol. 87(2), pages 260-64, May.
  10. Edward P. Lazear, 2004. "Speeding, Tax Fraud, and Teaching to the Test," NBER Working Papers 10932, National Bureau of Economic Research, Inc.
  11. Richard Blundell & Monica Costa Dias, 2000. "Evaluation methods for non-experimental data," Fiscal Studies, Institute for Fiscal Studies, vol. 21(4), pages 427-468, January.
  12. repec:oup:restud:v:65:y:1998:i:2:p:261-94 is not listed on IDEAS
  13. 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.
  14. Hendrik Jürges & Kerstin Schneider & Felix Büchel, 2003. "The Effect of Central Exit Examinations on Student Achievement: Quasi-experimental Evidence from TIMSS Germany," CESifo Working Paper Series 939, CESifo Group Munich.
  15. Eric A. Hanushek & John F. Kain & Steven G. Rivkin, 1999. "Do Higher Salaries Buy Better Teachers?," NBER Working Papers 7082, National Bureau of Economic Research, Inc.
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