The Effects of Differential Pay on Teacher Recruitment and Retention

Traditionally, teacher salaries have been determined solely by experience and educational attainment. This has led to chronic shortages of teachers in particular subject areas, such as math, science and special education. We study the first long-running statewide program to differentiate teacher pay based on subject area, Georgia’s bonus system for math and science teachers. Using a difference-in-differences strategy, we find the bonuses reduce teacher attrition by 18 to 28 percent. However, we find no evidence the program increases the probability that education majors become secondary math or science teachers upon graduation or alters specific major choices within the education field.