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Do Financial Incentives Help Low-Performing Schools Attract and Keep Academically Talented Teachers? Evidence from California


  • Jennifer L. Steele
  • Richard J. Murnane
  • John B. Willett


This study capitalizes on a natural experiment that occurred in California between 2000 and 2002. In those years, the state offered a competitively allocated $20,000 incentive called the Governor's Teaching Fellowship (GTF) aimed at attracting academically talented, novice teachers to low-performing schools and retaining them in those schools for at least four years. Taking advantage of data on the career histories of 27,106 individuals who pursued California teaching licenses between 1998 and 2003, we use an instrumental variables strategy to estimate the unbiased impact of the GTF on the decisions of recipients to begin working in low-performing schools within two years after licensure program enrollment. We estimate that GTF recipients would have been less likely to teach in low-performing schools than observably similar counterparts had the GTF not existed, but that acquiring a GTF increased their probability of doing so by 28 percentage points. Examining retention patterns, we find that 75 percent of both GTF recipients and non-recipients who began working in low-performing schools remained in such schools for at least four years.

Suggested Citation

  • Jennifer L. Steele & Richard J. Murnane & John B. Willett, 2009. "Do Financial Incentives Help Low-Performing Schools Attract and Keep Academically Talented Teachers? Evidence from California," NBER Working Papers 14780, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:14780
    Note: ED LS

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    1. Imbens, Guido & van der Klaauw, Wilbert, 1995. "Evaluating the Cost of Conscription in The Netherlands," Journal of Business & Economic Statistics, American Statistical Association, vol. 13(2), pages 207-215, April.
    2. Clotfelter, Charles & Glennie, Elizabeth & Ladd, Helen & Vigdor, Jacob, 2008. "Would higher salaries keep teachers in high-poverty schools? Evidence from a policy intervention in North Carolina," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1352-1370, June.
    3. Clotfelter, Charles T. & Ladd, Helen F. & Vigdor, Jacob, 2005. "Who teaches whom? Race and the distribution of novice teachers," Economics of Education Review, Elsevier, vol. 24(4), pages 377-392, August.
    4. Donald Boyd & Pamela Grossman & Hamilton Lankford & Susanna Loeb & James Wyckoff, 2006. "How Changes in Entry Requirements Alter the Teacher Workforce and Affect Student Achievement," Education Finance and Policy, MIT Press, vol. 1(2), pages 176-216, April.
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    Cited by:

    1. Balch, Ryan & Springer, Matthew G., 2015. "Performance pay, test scores, and student learning objectives," Economics of Education Review, Elsevier, vol. 44(C), pages 114-125.
    2. Richard K. Mansfield, 2015. "Teacher Quality and Student Inequality," Journal of Labor Economics, University of Chicago Press, vol. 33(3), pages 751-788.
    3. Emiliana Vegas & Alejandro Ganimian, 2013. "Theory and Evidence on Teacher Policies in Developed and Developing Countries," IDB Publications (Working Papers) 4597, Inter-American Development Bank.

    More about this item

    JEL classification:

    • I2 - Health, Education, and Welfare - - Education
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy

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