TEACHER LOCATION CHOICE AND THE DISTRIBUTION OF QUALITY: EVIDENCE FROM NEW YORK CITY

I. INTRODUCTION This article investigates the distribution of teacher quality across the New York City school system. Because teachers with seniority are often able to choose the location where they teach and salary is paid along a fixed wage schedule, I can investigate the degree to which teachers are able to improve their utility by location to more agreeable environments. The theory of compensating wage differentials for quality-of-life factors in location views geographic places as interrelated bundles of wages, land rents, and amenities with differing bundles for different locations. If migration across regions is relatively cheap, then households, employees, and firms will compete for a fixed number of sites across locations, with agents seeking to maximize their pay-offs (utility or profit) through their location choice. In equilibrium, wages and land rents will vary across locations to equate household utility (Gabriel et al. 2003; Rosen 1979). If two regions, for example, have the same exact bundle of amenities, except one location has a relatively milder climate, then the theory predicts that this location would have a lower wage because, all else equal, the milder climate would compensate utility in exchange for a lower wage. Studies in this vein have generally looked at urban wages across regions as a measure of the value of different locations (Bloomquist et al. 1988; Roback 1988). This theory also applies to employment choice in neighborhoods within a region as well. Workers, for example, would need to be compensated to work in dangerous neighborhoods or areas without available parking or other local amenities. In a special case, where wages are held constant across a particular area, one would expect to see an uneven distribution of worker quality. In particular, schoolteachers in the New York City school system are paid along a fixed salary schedule based on the number of years of service in the system and the number of graduate credits. Because schools cannot offer wage differentials based on the nature of the working environment, and teachers with seniority can transfer to districts of their choosing, I can directly measure the degree to which working environment and neighborhood characteristics affect the distribution of quality across both schools and neighborhoods. (1) This study uses data provided by the New York City school system plus other New York City-level data to investigate the relationship between school and neighborhood quality and teacher quality. Here, three measures of teacher quality are used: the percentage of teachers in each school with greater than five years of teaching experience, the percentage of teachers with a master's degree, and the percentage of teachers who have been in their particular school for more than two years. Teacher experience and teacher education levels are common measures of quality. Further-more, length of school tenure is an important quality measure because the longer a teacher stays within in a school, the better the teacher will have adapted to teaching to a particular student body, within a particular organizational framework, and with a particular curriculum. These measures of quality are not mutually exclusive. There is still a debate, though, regarding these measures of quality because economists have found mixed findings of the effects of these measures on student performance (Hanushek 1986). However, this does not mean they are not important measures to investigate. With regard to education, they are still used by schools, school districts, departments of education, parents, and policy makers as measures of quality because they are commonly accepted labor market inputs (Ehrenberg and Smith 2003). Furthermore, the mixed findings on standardized test performance does not mean that they are unimportant in the overall education of students, the effects of which might not be directly captured in the regressions. …