Economic Ordering for Multiple Values
Edited by Susi Geiger, Debbie Harrison, Hans Kjellberg and Alexandre Mallard
Chapter 2: Expressing concerns over the incentive as a public policy device
Monetary incentives have recently become a fashionable instrument in education. The overall level of education is expected to rise when teachers receive a bonus for increased student performance. Israel was the first to experiment with performance-based pay for teaching personnel. In 2000, the Israeli government began to reward individuals and teams of the participating schools when they managed to accomplish a rise in student scores on matriculation exams. In the United States, several individual states similarly experimented with bonuses in primary and secondary education (Lavy, 2009). A nationwide program of performance pay for American teachers was established in 2006. The best performing among them would receive additional rewards drawn from the so-called Teacher Incentive Fund. Other countries such as Australia and the UK followed suit. In the Netherlands, the appreciation for and implementation of this particular policy measure came relatively late. A coalition of Liberals and Christian Democrats set 250 million euros aside in 2010 to spend on performance pay over a period of five years. In line with the Israeli approach, the Dutch government decided to begin with a series of experiments so as to ascertain what type of bonus would work best. Several schools participated in a pilot study just after the coalition agreement was signed.
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