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Early Retirement Incentives and Student Achievement

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  • Maria D. Fitzpatrick
  • Michael F. Lovenheim

Abstract

Early retirement incentives (ERIs) are increasingly prevalent in education as districts seek to close budget gaps by replacing expensive experienced teachers with lower cost newer teachers. Combined with the aging of the teacher workforce, these ERIs are likely to change the composition of teachers dramatically in the coming years. We use exogenous variation from an ERI program in Illinois in the mid-1990s to provide the first evidence in the literature of the effects of large-scale teacher retirements on student achievement. We find the program did not reduce test scores; likely, it increased them, with positive effects most pronounced in lower SES schools.

Suggested Citation

  • Maria D. Fitzpatrick & Michael F. Lovenheim, 2014. "Early Retirement Incentives and Student Achievement," American Economic Journal: Economic Policy, American Economic Association, vol. 6(3), pages 120-154, August.
    • Handle: RePEc:aea:aejpol:v:6:y:2014:i:3:p:120-54
    Note: DOI: 10.1257/pol.6.3.120
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    Citations

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    Cited by:

    1. Kim, Dongwoo & Koedel, Cory & Ni, Shawn & Podgursky, Michael, 2017. "Labor market frictions and production efficiency in public schools," Economics of Education Review, Elsevier, vol. 60(C), pages 54-67.
    2. Shawn Ni & Michael Podgursky & Xiqian Wang, 2022. "Teacher Pension Plan Incentives, Retirement Decisions, and Workforce Quality," Journal of Human Resources, University of Wisconsin Press, vol. 57(1), pages 272-303.
    3. Patten Priestley Mahler, 2017. "Are Teacher Pensions "Hazardous" for Schools?," Upjohn Working Papers 18-281, W.E. Upjohn Institute for Employment Research.
    4. Dongwoo Kim & Cory Koedel & Wei Kong & Shawn Ni & Michael Podgursky & Weiwei Wu, 2021. "Pensions and Late-Career Teacher Retention," Education Finance and Policy, MIT Press, vol. 16(1), pages 42-65, Winter.
    5. Morrill, Melinda Sandler & Westall, John, 2019. "Social security and retirement timing: evidence from a national sample of teachers," Journal of Pension Economics and Finance, Cambridge University Press, vol. 18(4), pages 549-564, October.
    6. Figlio, D. & Karbownik, K. & Salvanes, K.G., 2016. "Education Research and Administrative Data," Handbook of the Economics of Education,, Elsevier.
    7. Laura D. Quinby, 2020. "Do Deferred Retirement Benefits Retain Government Employees?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 39(2), pages 469-509, March.
    8. Aibo Gong, 2021. "Bounds for Treatment Effects in the Presence of Anticipatory Behavior," Papers 2111.06573, arXiv.org, revised Dec 2022.
    9. Sun, Liyang & Abraham, Sarah, 2021. "Estimating dynamic treatment effects in event studies with heterogeneous treatment effects," Journal of Econometrics, Elsevier, vol. 225(2), pages 175-199.
    10. Shawn Ni & Michael Podgursky & Fangda Wang, 2022. "How Much Are Public School Teachers Willing to Pay for Their Retirement Benefits? Comment," American Economic Journal: Economic Policy, American Economic Association, vol. 14(3), pages 478-493, August.
    11. Robert Clark & Melinda Morrill, 2013. "Increasing Work Life: The Role Of The Employer," Discussion Papers 13-016, Stanford Institute for Economic Policy Research.
    12. Shawn Ni & Michael Podgursky & Fangda Wang, 2020. "How Teachers Value Pension Wealth: A Reexamination of the Illinois Experience," Working Papers 2007, Department of Economics, University of Missouri.
    13. Quinby, Laura D. & Wettstein, Gal, 2021. "Do deferred benefit cuts for current employees increase separation?," Labour Economics, Elsevier, vol. 73(C).
    14. Kim, Dongwoo, 2020. "Worker retirement responses to pension incentives: Do they respond to pension wealth?," Journal of Economic Behavior & Organization, Elsevier, vol. 173(C), pages 365-385.

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    More about this item

    JEL classification:

    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets

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