Thursday, June 23, 2005

Supply-side merit pay 

Teaching is hard, and teaching to the children of the urban poor is many times harder. So when you hear a story of great teachers turning around a district in New York City, you have to wonder how it is done. Nicole Gelinas explains that it's hard work:
It�s no mystery why scores are going up: a gifted, determined manager who motivated teachers to succeed. The district�s leader, Kathleen Cashin, established clear expectations for principals and teachers, and pushed the schools in the district to meet them. P.S./I.S. 41 principal Myron Rock enthuses that his teachers worked evenings, Saturdays, and vacations to push students.
But, Gelinas explains, the teachers had to do it only for pride because they could not get additional money for the extra hours and effort they put in. Gelinas draws on a paper from 2003 by Caroline Hoxby and Andrew Leigh that shows a relationship between the compression in wages for female teachers and teacher aptitude. The reason, they explain, is that in other occupations, the wage gap between men and women of higher aptitude declined (not so for those of lower aptitude).
When we began this study, our prior was that pay parity would play the major and pay compression the minor role. We had not recognized the implications of the fact that pay parity changed similarly for college women of all aptitudes, which makes its smaller role predictable. Put another way, outside of teaching, high aptitude college women did not gain dramatically relative to low aptitude
college women: they all gained over time. However, in teaching, high aptitude women experienced substantial relative losses.
As a result, the share of teachers in the lowest aptitude category rose from 16% to 36%, of which 2/3 of the increase was due to pay compression.

To induce better teachers -- those with higher aptitude -- that pay compression needs to be released. That's what merit pay does. Merit pay pulls in higher-aptitude teachers from alternative forms of employment.

SCSU does not have merit pay. What this means for the quality of the faculty is quite clear: It makes it quite difficult to retain top faculty. The issue is under debate in the current round of contract negotiations.