Monetary Incentives and the Reform of Teacher Compensation: A Persistent Organizational Dilemma

It seems that whenever education comes under at­ tack, school reformers turn first to private sector models of monetary incentives to increase what they perceive as a lack of teacher productivity. The use of monetary incentives in the private sector is predicated on the basic economic assumption that workers will increase their level of effort if they believe that their rewards will increase accordingly. The application of monetary incentives to education assumes that teach­ ers are subject to the same income/leisure substitution effects as workers in other vocations. Advocates of monetary incentive plans argue that without such in­ centives there is little reason for workers, teachers in­ cluded, to exert effort beyond the minimum perfor­ mance requirements of their respective jobs. During the 1980s, over 99 % of the teachers in the U.S. worked in districts using uniform schedules that paid salary increments based solely on longevity and graduate credit accumulation (Murnane and Cohen, 1985) . At the same time, a number of influential reports appeared that questioned the quality of public schools in the U.S. (see, for example, Boyer, 1983 ; Goodlad, 1983; National Commission on Excellence in Education, 1983) . These reports raised the spectre that a deteriorating educational system posed a serious threat to America's global economic pre-eminence. In­ deed, some suggested that a causal relationship existed between the widespread use of the uniform salary schedule and "the rising tide of mediocrity" in Ameri­ can public education (NCEE, 1983) . The issue re­ ceived considerable public attention ·and led to calls for marked changes in the way teachers are compensated. Among the most often recommended compen­ sation reforms were increases in entry-level wages, career ladders with differentiated salaries and scarcity bonuses. But the most contentious reform proposals were calls for performance-related pay, more com­ monly known in the U.S. as "merit pay" (Lipsky and Bacharach, 1983) . As we shall see, merit pay plans have been tried and tried again in public education, but their use has always been short-lived. Obviously, the question of whether the plans work needs to be examined. Not surprisingly, some plans work and others don't. But, judging the vicissitudes of educational policy solely on the relative success of a few monetary incentive plans represents a limited perspective. There seems to be a regular ebb and flow in public interest in the use of monetary incentives for teachers, and the question of how to most appropriately compensate teachers is one that persists. As Cuban (1993, p. 6) points out, prob­ lems that persist often do so because they require choices to be made between "competing, highly prized values (that) cannot be fully satisfied. " Cuban suggests that attempts to use the "template of technical ratio­ nality" to address administrative problems may hide conflicts in inherent values, leading to conflict-filled "dilemmas" of administrative practice. Unlike prob­ lems that can be solved, dilemmas can only be managed, and the key to managing these persistent dilemmas is to recognize the values that are in con­ flict.