The Teacher Labor Market

The Teacher Labor Market

The adequate supply of quality teachers is a critical input for high quality education, and better students today become high-quality teachers tomorrow, leading to a more robust teacher labor market.

The adequate supply of quality teachers is a critical input for high quality education, and better students today become high-quality teachers tomorrow, leading to a more robust teacher labor market.

A functioning teacher market can generate a virtuous educational and learning cycle. Recruiting, retaining, and training the best teachers in the labor market ensures that children have access to the key teaching inputs that increase learning. Further educational demand from parents can support blossoming and widespread teacher markets growing the share of employment opportunities that the educational sector presents – especially for women.

Current Research

1. Students today, teachers tomorrow

A LEAPS study showed that private schools are three times more likely to set up in villages where there is a secondary school for girls, because the students in those schools become the teachers in private schools later on. We show that villages with secondary schools for girls have lower private school wages, arguing that this is a supply-side effect rather than one that stems from more educated women becoming mothers who demand more education for their children.


Read More
Students Today, Teachers Tomorrow: Identifying Constraints on the Provision of Education 


2. The links between wages and teacher effectiveness''

Using test score data for teachers as well as students, we calculate a value added (as a proxy for productivity) for each teacher: an estimate of the test score gains that a random student would receive if assigned to that teacher. We estimate that moving a student from a teacher at the 5th percentile to one at the 95th would increase the student’s test scores by the equivalent of more than a year of school.

Surprisingly, only teachers’ content knowledge (as measured by their scores on the primary school tests) and their first two years of experience predict their value added – neither a bachelor’s degree nor teacher training is associated with value added. But having a bachelor’s degree does positively predict wages in both the public and private sectors. In the private sector, teachers with higher value added are paid more. In the public sector, however, there is no relationship between teacher value added and wages.

Read More
Teachers' Effectiveness in Pakistan and the Link to Wages


3. The impact of performance pay on teacher hiring, retention, and student learning

Attracting and retaining high-quality teachers has a large social benefit, but it is challenging for schools to identify good teachers ahead of time. In a study involving 7,000 teachers in 243 private schools in Pakistan we study whether offering performance pay, i.e. linking teacher salaries to either student test scores or a principal's evaluation, instead of flat raises, affects the composition of teachers. We show that performance pay induces positive sorting, where teachers with performance pay have higher value-added and high-quality teachers tend to seek out performance pay options. 

Using two additional treatments, we show effects are more pronounced among teachers with better information about their quality and teachers with lower switching costs. Accounting for these sorting effects, the total effect of performance pay on test scores is twice as large as the direct effect on the existing stock of teachers, suggesting that analyses that ignore sorting effects may substantially understate the effects of performance pay.


4. Comparing objective and subjective teacher evaluation systems

This study expands on the research outlined above by exploring the details of what types of performance pay are most effective. We study the effect of subjective versus objective performance incentives on teacher productivity using a randomized controlled trial in nearly 250 Pakistani private schools. We estimate the effect of two performance raise treatments versus a control condition, in which all teachers receive the same raise. The first treatment arm is a “subjective” raise, in which principals evaluate teachers; the second treatment arm an “objective” raise based on student test scores.

First, we show that both subjective and objective incentives are equally effective at increasing test scores. However, objective incentives decrease student socio-emotional development. Second, we show that these effects are likely driven by the types of behavior change we observe from teachers during classroom observations. In objective schools, teachers spend more time on test preparation and use more punitive discipline, whereas, in subjective schools, pedagogy improves. 



Article |

Researchers at EPoD and CERP explore how to improve quality in Pakistan’s schools.

Article |

Teacher effectiveness does not necessarily correlate with teacher wages.