Education Level

How much do teachers value compensation that is deferred until retirement? This question is important because the vast majority of public school teachers are covered by defined benefit (DB) pension plans that “backload” a large share of compensation to retirement relative to the compensation structure in the private sector. There is little evidence, other than Fitzpatrick (2015), however, about whether DB pensions are consistent with teacher preferences for current and deferred compensation. This study examines a unique setting in Washington State, where teachers enroll in a hybrid, DB-Defined Contribution (DC) pension system, and have choices over their DC contribute rate. These choices reveal preferences about the value teachers place on current versus retirement compensation. We find that teachers choose to contribute an average of 8.18 percent, significantly more than the minimum required contribution of 5 percent. This suggests that teachers value retirement compensation significantly more than previously estimated by Fitzpatrick. Potential explanations for the difference in findings from prior evidence are discussed, including estimation strategies, differences in state settings, overall plan generosity, and the potential for teachers to view DB and DC pensions as different products.

Citation: Dan Goldhaber, Kristian Holden (2020). How Much do Teachers Value Deferred Compensation? Evidence from Defined Contribution Rate Choices. CALDER Working Paper No. 242-0920

Many states enhanced benefits in teacher retirement plans during the 1990s. This paper examines the school staffing effects of one such enhancement in a major urban school district with mostly high poverty schools. Pension rule changes in 1999 for St. Louis public school teachers resulted in very large increases in pension wealth for active teachers, as well as a powerful increase in “push” incentives for earlier retirement. Simple descriptive statistics on retirement patterns before and after the enhancements suggest much earlier retirement resulted. Shorter teaching spells imply a steady state with more teaching vacancies and a larger share of novice teachers in classrooms. To better understand the long run effects of these changes and alternatives policies, the authors estimate a structural model of teacher retirement. Simulations of retirement behavior for a representative senior teacher point to shorter completed teaching spells and earlier retirement age as a result of the enhancements. By contrast, moving from the post-1999 to a DC- type plan would extend the teaching career of a representative senior teacher by roughly three years. Simulations of voluntary DC conversation plans suggest that many senior teachers would enroll, thereby reducing workforce turnover, and overall pension costs.

Citation: Shawn Ni, Michael Podgursky, Xiqian Wang (2020). Teacher Pension Enhancements and Staffing in an Urban School District. CALDER Working Paper No. 240-0620

Defined benefit (DB) pension systems determine the size of pension payments using an employee’s “final average salary”. Thus, employees enrolled in DB pension systems face an incentive to “salary spike” – strategically increase late career pensionable compensation – to increase their retirement income. This is an important issue given that public pension systems face increasing scrutiny due to ongoing concerns about their fiscal sustainability. This paper develops an empirical method to quantify the prevalence of salary spiking by identifying cases where end-of-career compensation deviates from expected levels of compensation. We apply this method to the teacher pension systems in Illinois and examine how salary spiking changed in response to policy reform. The results suggest that salary spiking is very common, with about half of late career employees observed as having pensionable compensation that exceeds expectations. Policies designed to dissuade salary spiking by internalizing its costs across districts appear to reduce the prevalence of salary spiking, but there may be unintended consequences for individuals who are not actually spiking, as such discouraging the assignment of supplementary responsibilities to late career employees.

Citation: Dan Goldhaber, Cyrus Grout, Kristian Holden (2020). A Method for Identifying Salary Spiking: An Assessment of Pensionable Compensation and Reform in Illinois. CALDER Working Paper No. 238-0620

We use a novel database of student teaching placements in Washington State to investigate teachers’ transitions from student teaching classrooms to first job classrooms and the implications for student achievement. We find that first-year teachers are more effective when they are teaching in the same grade, in the same school level, or in a classroom with student demographics similar to their student teaching classroom. We also document that only 27% of first-year teachers are teaching the same grade they student taught, and that first-year teachers tend to begin their careers in higher-poverty classrooms than their student teaching placements. This suggests that better aligning student teacher placements with first-year teacher hiring could be a policy lever for improving early-career teacher effectiveness.

Citation: John Krieg, Dan Goldhaber, Roddy Theobald (2020). Disconnected Development? The Importance of Specific Human Capital in the Transition from Student Teaching to the Classroom. CALDER Working Paper No. 236-0520

The Community Eligibility Provision (CEP) is a policy change to the federally-administered National School Lunch Program that allows schools serving low-income populations to classify all students as eligible for free meals, regardless of individual circumstances. This has implications for the use of free and reduced-price meal (FRM) data to proxy for student disadvantage in education research and policy applications, which is a common practice. We document empirically how the CEP has affected the value of FRM eligibility as a proxy for student disadvantage. At the individual student level, we show that there is essentially no effect of the CEP. However, the CEP does meaningfully change the information conveyed by the share of FRM-eligible students in a school. It is this latter measure that is most relevant for policy uses of FRM data.

Note: Portions of this paper were previously circulated under the title “Using Free Meal and Direct Certification Data to Proxy for Student Disadvantage in the Era of the Community Eligibility Provision.” We have since split the original paper into two parts. This is the first part.

WP 234-0320 was originally released in March 2020. This is the third update, WP 234-0320-3, which was released in September 2020.

Citation: Cory Koedel, Eric Parsons (2020). The Effect of the Community Eligibility Provision on the Ability of Free and Reduced-Price Meal Data to Identify Disadvantaged Students. CALDER Working Paper No. 234-0320-3

This study adds to the currently limited evidence base on the efficacy of interventions targeting non-college-ready high school students by examining the impact of Kentucky’s Targeted Interventions (TI) program. We focus on interventions that students received under TI in the senior year of high school based on their 11th grade ACT test scores. Using difference-in-regression discontinuity and difference-in-difference designs with seven cohorts of 11th grade students, we find that, for an average per-student cost of about $600, TI significantly reduces the likelihood that students enroll in remedial course in both 2- and 4-year postsecondary institutions by 5–10 percentage points in math and 3–4 percentage points in English. These effects are similar among students who are eligible for free-or reduced-price lunch, Black and Hispanic students, students with remediation needs in multiple subjects, and students in lower-performing schools. Evidence also shows that TI increases the likelihood that students enroll in and pass college math before the end of the first year by four percentage points in 4-year universities. However, little evidence exists for TI affecting credit accumulation or persistence.

Citation: Zeyu Xu, Benjamin Backes, Amanda Oliveira, Dan Goldhaber (2020). Targeted Interventions in High School: Preparing Students for College. CALDER Working Paper No. 232-0220

Using detailed administrative data for public schools, we document racial and ethnic segregation at the classroom level in North Carolina, a state that has experienced a sharp increase in Hispanic enrollment.  We decompose classroom-level segregation in counties into within-school and between-school components. We find that the within-school component accounted for a sizable share of total segregation in middle schools and high schools. Recognizing its importance could temper the praise for school assignment policies that reduce racial disparities between schools but allow large disparities within them. More generally, we observe between the two components a complementary relationship, with one component tending to be large when the other one is small. Comparing the degree of segregation for the state’s two largest racial/ethnic minority groups, we find that White/Hispanic segregation was more severe than White/Black segregation, particularly within schools. Finally, we examine enrollment patterns by course and show that school segregation brings with it differences by race and ethnicity in the courses that students take, with White students more likely to be enrolled in advanced classes.

WP 230-0220 was originally released in February 2020. This is the third update, WP 230-0220-3, released in January 2021.

Citation: Charles Clotfelter, Helen Ladd, Calen R. Clifton, Mavzuna R. Turaeva (2020). School Segregation at the Classroom Level in a Southern ‘New Destination’ State. CALDER Working Paper No. 230-0220-3

While the majority of students with disabilities (SWDs) receive instruction from general education teachers, little empirical work has investigated the ways in which these students have equitable access to high-quality teachers. We explore the differences in teacher quality experienced by SWDs and general education (GEN) students and how that access varies with school-level disadvantage by estimating SWD teacher quality gaps in the Los Angeles Unified School District. We examine several different indicators of teacher effectiveness (hiring scores, teacher experience, teachers’ ratings on their observation-based performance evaluations, and value-added measures) for general education teachers who instruct both SWDs and general education (GEN) students. We find that SWDs are significantly more likely to have lower math VAM teachers than their GEN peers, and these gaps do not vary by school-level disadvantage. We find no differences on the other indicators of teacher effectiveness.

Citation: Ijun Lai, W. Jesse Wood, Scott A. Imberman, Nathan Jones, Katharine Strunk (2020). Teacher Quality Gaps by Disability and Socioeconomic Status: Evidence from Los Angeles. CALDER Working Paper No. 228-0220

We describe the postsecondary transitions of students taking CTE courses in high school using administrative data on one cohort of high school graduates in Washington State. Conditional on observable characteristics, CTE concentrators—high school graduates who complete at least four CTE credits—are about 4 percentage points less likely to enroll in college than other high school graduates. However, CTE students are significantly more likely to enroll in and complete vocational programs, especially in certificate programs in applied STEM and public safety fields. Among students not enrolled in college, CTE students are also more likely to obtain full-time employment—and to work more intensively—within the first three years following high school graduation. Although the improvements in employment outcomes do not offset reductions in college enrollment, the higher completion rates of vocational credentials among CTE concentrators indicate some important positive outcomes for this population.

Citation: James Cowan, Dan Goldhaber, Harry Holzer, Natsumi Naito, Zeyu Xu (2019). Career and Technical Education in High School and Postsecondary Pathways in Washington State. CALDER Working Paper No. 224-1119