Incentives Matter. Or Not?
Don Boudreaux argues below that if teachers don't respond positively to monetary incentives (merit pay), then they likewise shouldn't respond negatively to pay cuts, and we can therefore save millions and billions of dollars by cutting teachers' salaries?
If teachers do not respond positively to the prospect of higher monetary rewards, they are unlikely to respond negatively to the prospect of lower monetary rewards. Alternatively, if the problem with merit pay is that measuring teacher performance is simply too difficult, then we can conclude that Fairfax teachers now are as likely to be doing a truly lousy job at educating children as they are to be doing an excellent job at this task. (Indeed, if performance can’t be monitored, then chances are the teachers are doing a lousy job. After all, why put forth effort if worthwhile results of your effort – or lack thereof – are undetectable?)
Either way, cutting teachers’ pay is unlikely to reduce the quality of education supplied in the County schools. If teachers aren’t motivated by money, then they’ll work just as diligently at lower pay as they will at higher pay; if cutting pay will, in fact, cause some teachers to quit, their replacements are likely to perform no worse than them.