Exploring the Use of Incentives to Influence the Quality and Distribution of Teachers

A large and growing body of research on schools convincingly shows that teacher quality is the most important schooling factor influencing student achievement.1 The difference between having a very effective versus a very ineffective teacher is estimated to be equivalent to as much as a full year’s difference in learning growth for students (Hanushek, 1992). Moreover the impact of differences in teacher quality swamps the impact of other educational investments, such as reductions in class size (Goldhaber et al., 1999 Rivkin et al., 2005).2 To put it in perspective, Rivkin et al. (2005) and Rockoff (2004) estimate that a one standard deviation increase in teacher quality raises student achievement in reading and mathematics by about 10% of a standard deviation – an achievement effect that is on the same order of magnitude as lowering class size by 10 to 13 students (Rivkin et al., 2005). Given findings like these, it is no surprise that policy makers are exploring ways to increase the quality of the teacher workforce.