Double for Nothing? Experimental Evidence on an Unconditional Teacher Salary Increase in Indonesia
By J. de Ree, K. Muralidharan, M. Pradhan, F. H. Rogers. 2017
189 citations recorded by the source corpus.
How does a large unconditional increase in salary affect the performance of incumbent employees in the public sector? This paper presents experimental evidence on this question in the context of a policy change in Indonesia that led to a permanent doubling of teachers' base salaries. The analysis uses a large-scale, randomized experiment across a representative sample of Indonesian schools that accelerated this pay increase for teachers in treated schools. The findings show that the large pay increase significantly improved teachers' satisfaction with their income, reduced the incidence of teachers holding outside jobs, and reduced self-reported financial stress. Nevertheless, after two and three years, the increase in pay led to no improvement in student learning outcomes. The effects are precisely estimated, making it possible to rule out even modest positive impacts on test scores. The results suggest that unconditional pay increases are unlikely to be an effective policy option for improving the effort and productivity of incumbent employees in public sector settings.
Subfields: Economics and Econometrics, Education, Safety Research
View Paper: https://www.semanticscholar.org/paper/82bba496c2e2d3bd8b1fe6a012c84dea5bd72011
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Citations in the corpus
- Inputs, Incentives, and Complementarities in Education: Experimental Evidence from Tanzania* (2018, unknown): “38Such an approach may be especially promising to consider because typical across-the-board teacher salary increases are unlikely to have any positive impact on the effectiveness of incumbent teachers as shown recently by de Ree et al. (2018). 39We abstract away from a risk-aversion premium that may”
- Experimental evidence on scaling up education reforms in Kenya (2018, background): “Though it should be noted that in our context, the wage variation entails both a selection effect and an incentive effect, while de Ree et al. (2017) study a wage increase for ex-ante identical teachers.”