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Journal of Labor Economics Vol. 37 No. 3 2019

Pay by Design: Teacher Performance Pay Design and the Distribution of Student Achievement

Prashant Loyalka1; Sean Sylvia2; Chengfang Liu3; James Chu1; Yaojiang Shi4

1 Stanford University · 2 University of North Carolina at Chapel Hill · 3 Peking University · 4 Shaanxi Normal University

Abstract

We present results of a randomized trial testing alternative approaches of mapping student achievement into rewards for teachers. Teachers in 216 schools in western China were assigned to performance pay schemes where teacher performance was assessed by one of three different methods. We find that teachers offered “pay-for-percentile” incentives outperform teachers offered simpler schemes based on class-average achievement or average gains over a school year. Moreover, pay-for-percentile incentives produced broad-based gains across students within classes. That teachers respond to relatively intricate features of incentive schemes highlights the importance of paying close attention to performance pay design.

DOI
10.1086/702625
Volume
37
Issue
3
Pages
621-662
Language
en
Sources
openalex crossref

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