Performance pay for teachers: Determinants and consequences

Clive R. Belfield and John S. Heywood ()

Economics of Education Review, 2008, vol. 27, issue 3, pages 243-252

Abstract: Theory and evidence on performance-related pay for teaching remain inconclusive. Teachers will respond to rewards, but an appropriate reward structure may not be devised because education is a collaborative endeavor. Here we test three hypotheses: performance-related pay among teachers is more likely to be observed when there are evident indicators of team production; teachers receiving performance pay will earn more in total than otherwise equal teachers without performance pay; and teachers receiving performance pay should have higher job satisfaction. We use the Schools and Staffing Survey (2000) to test each hypothesis. Team production does strongly predict performance-related pay, and that such pay does boost earnings, but that job satisfaction is lower for those who receive such pay awards.

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