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Teacher Preferences, Working Conditions, and Compensation Structure

Improving schools depends on attracting high-caliber teachers and increasing retention, both made possible by appealing to teacher preferences. Since these preferences cannot be estimated from traditional choice records, I deploy a discrete-choice experiment in a setting where teachers have reason to reveal their preferences. This generates three main findings: (1) I calculate willingness-to-pay for a series of workplace attributes including salary structure, retirement benefits, performance pay, class size, and time-to-tenure; schools can improve the appeal of teaching by shifting compensation into vehicles with greater WTP-to-cost ratios. (2) Highly rated teachers have stronger preferences for schools offering performance pay, which may be used to differentially attract and retain them. (3) Using preferences, I simulate how a school would structure compensation to maximize (i) teacher welfare, (ii) teacher retention, or (iii) student achievement. Under each criterion, the results suggest that schools underpay in salary and performance pay while overpaying in retirement benefits.

Teachers, Labor Markets, Compensation, Salaries, Pay-for-performance, Teacher Selection,Teacher Retention
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EdWorkingPaper suggested citation:

Johnston, Andrew C.. (). Teacher Preferences, Working Conditions, and Compensation Structure. (EdWorkingPaper: -202). Retrieved from Annenberg Institute at Brown University:

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