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Teacher labor market policy and the theory of the second best

Author

Listed:
  • Michael Bates

    (Department of Economics, University of California Riverside)

  • Michael Dinerstein

    (University of Chicago)

  • Andrew Johnston

    (UC Merced)

  • Isaac Sorkin

    (Stanford University)

Abstract

The teacher labor market is a two-sided matching market where the effects of policies depend on the actions of both sides. We specify a matching model of teachers and schools that we estimate with rich data on teachers’ applications and principals’ ratings. Both teachers’ and principals’ preferences deviate from those that would maximize the achievement of economically disadvantaged students: teachers prefer schools with fewer disadvantaged students, and principals’ ratings are weakly related to teacher effectiveness. In equilibrium, these two deviations combine to produce a surprisingly equitable current allocation where teacher quality is balanced across advantaged and disadvantaged students. To close academic achievement gaps, policies that address deviations on one side alone are ineffective or harmful, while policies that address both deviations could substantially increase disadvantaged students’ achievement.

Suggested Citation

  • Michael Bates & Michael Dinerstein & Andrew Johnston & Isaac Sorkin, 2023. "Teacher labor market policy and the theory of the second best," Working Papers 202312, University of California at Riverside, Department of Economics, revised Aug 2023.
    • Handle: RePEc:ucr:wpaper:202312
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    References listed on IDEAS

    as
    1. Michael Bates, 2020. "Public and Private Employer Learning: Evidence from the Adoption of Teacher Value Added," Journal of Labor Economics, University of Chicago Press, vol. 38(2), pages 375-420.
    2. C. Kirabo Jackson, 2013. "Match Quality, Worker Productivity, and Worker Mobility: Direct Evidence from Teachers," The Review of Economics and Statistics, MIT Press, vol. 95(4), pages 1096-1116, October.
    3. Thomas J. Kane & Douglas O. Staiger, 2008. "Estimating Teacher Impacts on Student Achievement: An Experimental Evaluation," NBER Working Papers 14607, National Bureau of Economic Research, Inc.
    4. Raj Chetty & John N. Friedman & Jonah E. Rockoff, 2014. "Measuring the Impacts of Teachers II: Teacher Value-Added and Student Outcomes in Adulthood," American Economic Review, American Economic Association, vol. 104(9), pages 2633-2679, September.
    5. Don Boyd & Hamp Lankford & Susanna Loeb & Matthew Ronfeldt & Jim Wyckoff, 2011. "The role of teacher quality in retention and hiring: Using applications to transfer to uncover preferences of teachers and schools," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 30(1), pages 88-110, December.
    6. John P. Papay & Matthew A. Kraft, 2016. "The Productivity Costs of Inefficient Hiring Practices: Evidence From Late Teacher Hiring," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 35(4), pages 791-817, September.
    7. Raj Chetty & John N. Friedman & Jonah E. Rockoff, 2014. "Measuring the Impacts of Teachers I: Evaluating Bias in Teacher Value-Added Estimates," American Economic Review, American Economic Association, vol. 104(9), pages 2593-2632, September.
    8. Julien Combe & Umut Mert Dur & Olivier Tercieux & Camille Terrier & M. Utku Ünver, 2022. "Market Design for Distributional Objectives in (Re)assignment: An Application to Improve the Distribution of Teachers in Schools," Boston College Working Papers in Economics 1050, Boston College Department of Economics.
    9. Sass, Tim R. & Hannaway, Jane & Xu, Zeyu & Figlio, David N. & Feng, Li, 2012. "Value added of teachers in high-poverty schools and lower poverty schools," Journal of Urban Economics, Elsevier, vol. 72(2), pages 104-122.
    10. Esteban Aucejo & Patrick Coate & Jane Cooley Fruehwirth & Sean Kelly & Zachary Mozenter, 2022. "Teacher Effectiveness and Classroom Composition: Understanding Match Effects in the Classroom," The Economic Journal, Royal Economic Society, vol. 132(648), pages 3047-3064.
    11. Donald Boyd & Hamilton Lankford & Susanna Loeb & James Wyckoff, 2013. "Analyzing the Determinants of the Matching of Public School Teachers to Jobs: Disentangling the Preferences of Teachers and Employers," Journal of Labor Economics, University of Chicago Press, vol. 31(1), pages 83-117.
    12. Dale Ballou, 1996. "Do Public Schools Hire the Best Applicants?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 111(1), pages 97-133.
    13. C. Kirabo Jackson, 2018. "What Do Test Scores Miss? The Importance of Teacher Effects on Non–Test Score Outcomes," Journal of Political Economy, University of Chicago Press, vol. 126(5), pages 2072-2107.
    14. Hinrichs, Peter, 2021. "What kind of teachers are schools looking for? Evidence from a randomized field experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 186(C), pages 395-411.
    15. Thomas S. Dee, 2004. "Teachers, Race, and Student Achievement in a Randomized Experiment," The Review of Economics and Statistics, MIT Press, vol. 86(1), pages 195-210, February.
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    Cited by:

    1. Delgado, William, 2025. "Disparate teacher effects, comparative advantage, and match quality," Economics of Education Review, Elsevier, vol. 106(C).
    2. García-Echalar, Andrés & Poblete, Sebastián & Rau, Tomás, 2024. "Teacher value-added and the test score gender gap," Labour Economics, Elsevier, vol. 89(C).
    3. Howard, Greg & Weinstein, Russell, 2026. "Does Training Teachers Locally Affect Teacher Shortages? Evidence from Regional Public Universities," IZA Discussion Papers 18572, IZA Network @ LISER.
    4. Mariana Laverde & Elton Mykerezi & Aaron Sojourner & Aradhya Sood, 2023. "Gains from Reassignment: Evidence from A Two-Sided Teacher Market," Upjohn Working Papers 23-392, W.E. Upjohn Institute for Employment Research.

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    More about this item

    JEL classification:

    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets

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