The Economics and Politics of Teacher Merit Pay
One of the things that many people don’t realise about academic economics is how slowly the research pipeline moves. Since leaving the ANU in July 2010, virtually my only research activity has been to revise a few papers for publication, incorporating referee comments. Yet in 2011, I’ve had half a dozen papers appear in journals (partial list here), and there will be probably be a few more in 2012.
However, there is one new piece of research I’ve done, which comes out of a keynote talk I gave for an economics of education conference in Munich, organised by Eric Hanushek and Ludger Woessman. It gave me the chance to survey the burgeoning literature on the economics and politics of teacher merit pay.
I’ll be giving a talk tonight at the Grattan Institute, drawing on the paper. In case you’re interested, here’s a copy. Feedback most welcome (particularly if it sparks off the content of the paper, rather than just the title).
Andrew –
Thanks for a great talk tonight. It’s comforting to see a sane person in politics. This is a question that, although related, seemed inappropriate at the talk. When can we extend this debate on merit pay to higher education as well?
It’s no secret to those “in the know” that the quality of tuition at Australia’s universities is incredibly low by international standards. I came here to study at a “G8″ University after completing my undergraduate in the US without that knowledge and found out the hard way what I can only describe as the “factory approach” to learning. The lack of accountability–to students–at Australia’s *publicly funded* Universities seems to be in a league of it’s own. But I suppose pressure groups are least effective when most of the customers go home to their country of residence after final exams…
Alot of the discussion tonight revolved around “perverse incentives” created by using test scores as performance metrics. In a sense, the higher education system here is a perfect example of what happens when we have “perverse incentives” created by centralization; namely, the primary performance metric being publications in top ranked journals (whose rankings are decided by a government bureaucracy). We have a system here in Australia (prior to the changes in the ERA atleast) that explicitly overlooks quality of education in favor of journal publications. But let’s be honest, many star publishers couldn’t lecture their way out of a wet paper sack, much less motivate students and distill complex concepts. The hallmark of an excellent academic is that they can do both, however.
But in my opinion, and I may very well be wrong in my assessment, this approach fits quite well with the Australian Education business model — input foreign students, output diplomas. How do we increase the input? Well, lower (academic, not monetary) admissions standards and we prime the demand side by focusing all of our energy on publications (which are the primary driver in international rankings) and overseas recruitment in emerging markets. Supply problem? We’ll cram 500 students in a class ranging from year 3 to Postgraduate and defend it as a “rigorous experience” if someone complains. The problem is that the marketing propaganda suggests real value, yet we end up paying Filet Mignon prices for Hungry Jacks.
So I think we need not look that far for examples of the myopia that perverse incentives can create. We can start by turning an inward eye and quantifying the student dissatisfaction that a not for profit “in name only” higher education system creates.
Acceptance of merit pay for any profession depends upon acceptance of the definition of ‘merit’. We would like all those we have dealings with to be payed according to merit but the world is not entirely populated by small businessmen/women and therefore meeting our wishes is rarely possible in any organisation as large as a school, let alone a system. Sadly, however, merit-based pay for teachers is rarely part of an initiative to improve the learning conditions of students, despite how it usually presented by its public proponents. The idea particularly founders when it tries to identity which teachers make a greater, or conversely lesser, contribution to the development of a child or of a school.
The attempts to introduce merit-based pay is usually part of a program to control the ever-increasing costs involved in education, 85% plus of which is salaries. The assertion being that we can’t afford to give all the teachers a pay rise that reflects the great work done by schools, so we should just limit it to the numbers, usually very few, we can afford to reward. The problem is that paying the best teachers according to merit carries with it the assumption that the bulk of teachers, who have just as much responsibility for the education of our children, are consigned to a genteel penury to pay for the (usually modestly) higher salaries of their more expert colleagues. The proposal also fails to appreciate and reward those teachers who have been very effective in developing outstanding teams of colleagues but who have not sought personal recognition. Such teachers, in fact, are to be highly valued but under merit-based payments the selfish individualist is more likely to be rewarded, hardly a desirable outcome for anyone.
The idea of paying according to standardised test results is fraught with so many shortcomings that its sole asset, simplicity, is insufficient to justify its current attractiveness to political aspirants who should know better.
As I have shown, is it any wonder that their is reluctance by teachers and their leadership to accept such a divisive and simplistic solution to a serious problem.
Teachers are well aware of the variable competency of their colleagues but, like researchers and politicians, are unable to develop a simple tool to validly measure this attribute. Starving the least competent out of teaching by freezing their salaries is unlikely to produce a desirable teaching force as many factors contribute to teacher retention. What teachers want is a better way to intervene with some colleagues, which may comprise mandatory counselling/training and even compulsory leave and actual dismissal. Often a teacher who is struggling is well aware of their dilemma and supportive counselling may mean that they transfer from teaching into employment that is better suited to their skills and aspirations. In surprisingly few situations we find a teacher stubbornly refusing to accept the fact that they shouldn’t be teaching. None of this, however, will replace the need to pay teachers a LOT more (not just a CPI insult. This will not only attract better qualified trainees but it will assist schools to retain those who leave seeking greater rewards when the going gets tough or simply once they have a lesser need of school hours. If you think education is expensive, think of the costs of ignorance – both individually and as a community.
Paying teachers is a major challenge as there are simply thousands of them and to every parent, every day, each one is doing crucial work. We shouldn’t be surprised if paying them adequately causes tensions. Treasuries, acting on behalf of taxpayers, want to pay them a pittance but parents would love some to be payed their weight in gold.
As a policy maker, good luck with this one!