Nonmonetary Compensation in the Public Teacher Labor Market

Because of the rigid salary structure in the public teacher labor market, principals may have the incentive to align classes favorably for high-quality teachers as a form of nonmonetary compensation. This article tests whether higher-quality teachers, holding other characteristics constant, tend to be matched with more favorable assignments. The findings show that elementary teachers with higher licensure exam scores and greater observed classroom success tend to be matched to students with higher prior math ability, fewer students with learning disabilities, fewer students eligible for subsidized lunch, and more female students. Several tests indicate that matching patterns are not entirely driven by parental pressure or the technology of learning, providing evidence that principals use class assignments as a way to compensate teachers. © 2009 American Education Finance Association