The other day I included a few riffs on merit pay in response to a question posed by James Foreman. James has a response on his blog here.
Two other friends of DFER offered their thoughts on the matter. Wrote the first:
I read your posting on merit pay. I think many people miss the point on this subject. Merit pay is a great idea, but the correct way to implement it is to REMOVE the regulations on how teachers get paid and let school operators come up with their own approaches. The various complex schemes on how to implement merit pay through new government or contractual regulations might very well be cures that are worse than the disease. It is odd to read about these complex schemes when the free, unregulated, productive world shows us the simple, elegant, regulation-free answer every day.
The other wrote:
In response to your blog on merit pay. There are two ways to structure merit pay.
1) From the top down, you create an increasingly complex set of rules that may start simple, but grow with each set of negotiations and become a 200 page contract in and of itself. Of course it doesn’t start that way, but then all the “what-ifs” start and it ends up that way.
2) Or, you rely on market forces to create effective merit pay mechanisms. By market forces, you start with a school where kids can leave if there is failure or will apply in overwhelming numbers if there is success. Combine that with a governance structure that has responsibility for a successful school and who as part of that governance role evaluates the principal on his/her success or failure. That principal, to retain his/her job and to achieve his/her own merit pay is then incented to come up with an effective form of merit pay that truly retains talent. When you start breaking links in that chain of responsibility/governance/incentives, the whole system breaks down. Suppose for instance you want merit pay for teachers, but can’t fire a principal. Then you will find too many situations where a principal gives merit pay to favorite teachers instead of the most effective.