Measuring Quality for Use in Incentive Schemes: The Case of “Shrinkage” Estimators

Nirav Mehta

EconStor Preprints from ZBW - Leibniz Information Centre for Economics

Abstract: Researchers commonly “shrink” raw quality measures based on statistical criteria. This paper studies when and how this transformation’s statistical properties would confer economic benefits to a utility-maximizing decisionmaker across common asymmetric information environments. I develop the results for an application measuring teacher quality. The presence of a systematic relationship between teacher quality and class size could cause the data transformation to do either worse or better than the untransformed data. I use data from Los Angeles to confirm the presence of such a relationship and show that the simpler raw measure would outperform the one most commonly used in teacher incentive schemes.

Keywords: empirical contracts; teacher incentive schemes; teacher quality; economics of education (search for similar items in EconPapers)
JEL-codes: D81 I21 I28 J01 (search for similar items in EconPapers)
Date: 2018
New Economics Papers: this item is included in nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.econstor.eu/bitstream/10419/180846/1/m ... hemes_2018_07_13.pdf (application/pdf)

Related works:
Journal Article: Measuring quality for use in incentive schemes: The case of “shrinkage” estimators (2019)
Working Paper: Measuring Quality for Use in Incentive Schemes: The Case of "Shrinkage" Estimators (2018)
Working Paper: Measuring Quality for Use in Incentive Schemes: The Case of "Shrinkage" Estimators (2017)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:zbw:esprep:180846

Access Statistics for this paper

More papers in EconStor Preprints from ZBW - Leibniz Information Centre for Economics Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().