Teachers’ salaries and human capital, and their effects on academic performance: an institution-level analysis of Los Angeles County high schools

Salary disparities are also related to differences in teacher aptitude (quality). For example, data on salaries and scholastic aptitude for full-time public high school humanities, mathematics and science teachers analyzed in Gilpin (2012) suggest that that teacher aptitude and teacher salaries are positively related, although the elasticity is a modest 0.132. This study builds on work by Leigh and Ryan (2008), which compares the academic aptitude of individuals who have entered the teaching profession in Australia over the past two decades. They find that the aptitude of new Australian teachers fell markedly between 1983 and 2003, from an average percentile rank of 74 to one of 61. Leigh and Ryan (2008) attribute this decline to (1) a decline in teacher pay relative to non-teaching occupations, and (2) an increase in pay differentials throughout non-teaching occupations. Finally, Leigh (2012) finds that a one percent increase in starting salaries for teachers increases the average aptitude of students entering teacher education courses by 0.6 percentile ranks, and that larger pay disparities in non-teaching fields is negatively related to that particular aptitude measure. These results are based on data on test scores for all Australian university admittants from 1989 to 2003 (Leigh 2012).

Feng (2009) actually supports an earlier study by Murnane and Olsen (1990), which examines the career histories of almost 14,000 teachers in North Carolina and finds that teachers who are paid more have longer tenures in education. Thus, higher pay offsets, at least partially, the decrease in teaching participation rates that occurs over time after teacher certification (Stinebrickner 2001). Finally, Feng (2009) also supports Boyd et al. (2005), who find that teacher transfers in New York City’s elementary schools are positively related to salaries.

Clotfelter et al. (2008a, b) point out that a number of flaws in design, marketing and implementation of the $1,800 bonus program actually hampered its effectiveness.

Some studies report performance gains to increased pay of academic administrators. For example, Lavy (2008) reports modest gains (i.e., up to 10 percent) in matriculation rates, average test scores, and the number of courses completed in a study of high schools in Israel during a period when high school principals received a 50 % raise in salary. Based on the study’s results, Lavy (2008) concludes that efforts to improve academic outcomes should focus on increasing administrator remuneration rather than increasing teacher remuneration, where, as he suggests, evidence of the link between pay and outcomes is lacking.

This study also examines what is described as a failure by the New York City school board to hire teachers who had post-baccalaureate education levels beyond those required by teacher certification processes.

Hanushek (2011) adds that the marginal gains rise proportionately higher with larger-than-20 class sizes.

Charter and magnet high schools were omitted from the sample used in the current study.

The information that forms the basis for calculating the API comes from the results of the Standardized Testing and Reporting (STAR) Program and the California High School Exit Examination (CAHSEE).

Higher degrees include Master’s degree + 30, special degree (Juris Doctor), or a doctorate. This percentage is computed by dividing the number of teachers meeting this educational qualification level at each high school by the total number of teachers.