Incentives, Credentials, and the Limits of Teacher Sorting: Evidence from Performance Pay in Texas

Patrick Massey

Despite decades of reform efforts, students in low-income and rural schools continue to have less access to effective teachers than their more affluent peers. Policymakers have increasingly turned to financial incentives to address this gap, yet most existing programs are too small, too short-lived, or too narrow in scope to offer clear lessons. In this project, I study Texas's Teacher Incentive Allotment, a statewide performance-based compensation program launched in 2019 that designates teachers as Recognized, Exemplary, or Master and pays larger supplements at higher-need campuses. The program is designed explicitly to reward effective teachers and encourage them to work where they are needed most, creating financial incentives of a scale and permanence not seen in prior research. Using administrative data on Texas public school teachers, I examine how receiving a designation affects teachers' mobility and sorting across the socioeconomic distribution of schools, and whether the salary gradient embedded in the program is large enough to redirect effective teachers toward high-need campuses. I also recover teacher preferences over school working conditions and compensation to assess how much the program's incentives would need to change to meaningfully alter sorting behavior. Together, this research speaks directly to whether large-scale performance pay programs can close, rather than widen, gaps in access to effective teachers.

About Patrick Massey

Patrick Massey is an applied microeconomist and Ph.D. candidate in Economics at Michigan State University. His research applies econometric and discrete choice methods to study teacher labor markets, education policy, and the distribution of educational opportunity. His dissertation examines how performance-based compensation affects teacher mobility and sorting across schools, with a focus on whether financial incentives can improve access to effective teachers in high-need communities. Beyond his dissertation, Patrick's research agenda spans the economics of education more broadly. He has served as a research assistant to Scott Imberman and held a three-year Michigan State Interdisciplinary Training in Education and Social Science (MITTENSS) fellowship, during which he worked directly with local policymakers to evaluate the Lansing SAVE program, a universal children's savings account initiative. Prior to attending Michigan State, Patrick earned an M.A. in Economics from The University of Texas at Austin and a B.S. in Mathematics from Texas State University.