The Impacts of Performance Pay on Teacher Effectiveness and Retention: Does Teacher Gender Matter?

Abstract

Teacher performance pay is increasingly common in the United States. We assess the “incentive effects” of performance pay – the change in behavior of teachers present before and after a reform – with a focus on whether male and female teachers respond differently. Evaluating three performance pay programs in North Carolina, we find clear evidence of a gender difference: while male teachers’ value-added remains flat before and after the introduction of performance pay, the value-added of female teachers declines. We also document suggestive evidence of a gender difference in retention, with men more likely to remain in schools with performance pay.