Over the last two decades or so, quantitative researchers—particularly economists—have wrestled the attention of education policymakers away from teachers and education professionals. Drawing on the federal and state governments’ creation of rich, longitudinal data sets in education, the researchers have attracted strong proponents in both political parties with their sophisticated analyses. New secretary of education Arne Duncan, for example, is generally known as a supporter of a data-based approach to education and has praised incentive-based reforms, such as performance pay for teachers and charter schools, that economists tout. The prominence of quantitative measurement and econometric tools has important implications for the future of American education.

The most immediate benefit has been an improvement in empirical evaluation. Economists bring powerful statistical techniques to bear on the relationship between specific policies and student results. We now have a much firmer understanding of the answers to key questions—just how much teacher quality varies, for instance.

The role of economic theory in educational reform has proved more controversial, however, partly because economists’ thinking about education differs from that of teachers and parents and can rub them the wrong way. People who are attached to the public school system tend to focus on pedagogical practices and educational resources—that is, on curriculum, funding, and class size—because they assume that all parties are already working hard to improve student learning. But educational economists take a more behavioral approach. Over the last 30 years, they point out, school per-pupil resources have more than doubled in real dollars; yet all measures suggest that student achievement has remained stagnant. Schools already have the financial resources they need but are using them inefficiently, the economists argue. To them, the system operates ineffectively because of flawed incentives. Their goal is to align the incentives of administrators, principals, teachers, and even students with behavior that produces positive results.

Viewed through an economic lens, the incentives of the current public education system are completely out of whack. To take just one example: public school teachers are paid based on their years of experience and possession of advanced degrees. This may make sense to the teachers themselves and to education-college professors, but as an economic model, it’s nonsensical. Thanks to modern econometric studies, we can say with confidence that a teacher’s ability to produce student proficiency does not depend on experience and advanced degrees. Economic theory tells us that a better system would pay teachers according to their productivity.

While such a quantitative approach may seem heartless, it in fact provides the most powerful social-science framework available for optimal decision making with scarce resources. Further, the ability to step away from the classroom and think logically about education can be tremendously helpful. Looking a child in the eyes can fog anyone’s judgment. We can readily produce policies that make a child smile in the short term, but lead to tears down the road if that child fails to acquire the skills necessary for a productive, fulfilling life.

At the same time, it’s important to keep in mind the limitations of the quantitative approach. Analytical work can become too far removed from the classroom and lose sight of the ultimate goal, which is indeed improving the lives of children. Economists can also overlook the differences between analyzing businesses and analyzing schools. It’s almost certainly the case, for example, that teachers are internally motivated to help their students in a way that employees in a firm—generally motivated by external rewards, like salary—are not. Economic models based on pure incentives, then, will not work quite the same way in the two environments. A model based on increasing employee rewards at a private company might show a uniform uptick in performance, while teacher performance-pay models show a less uniform (though still demonstrative) improvement.

The influence of quantitative research on education is already noticeable. Incentive-based reforms are increasingly in use. School accountability policies are now enshrined in federal law under the No Child Left Behind Act. School choice is now widely viewed as desirable in one form or another. Several school systems have begun to experiment with performance pay to reward teachers who do the best jobs. Though we still have much to learn about such policies, many studies suggest that they are improving school effectiveness.

Looking ahead, it’s safe to say that quantitative tools for measuring educational progress are here to stay. Less certain—and more dependent on political currents—is the fate of incentive-based reforms grounded in economic analysis.


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