Securitizing Teens

What’s the best way to pay teachers based on performance? One Planet Money listener suggests tying teacher pay to their students’ future earnings, turning the students into “investments.” The scheme is reminiscent of Monetizing Emma, a play that recently ran in New York, about a future when Wall Street traders invest in smart schoolkids in return for a substantial share of their future earnings. Naturally, in this system, some children would be seen as “too bright to fail.” [%comments]

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  1. Daniel says:

    Interesting, but certainly not realizable. And upon a bit deeper thinking, not even desirable. As a high school math teacher I would love more than anything for some of my kids to veer from their medical, legal, or business ambitions and focus on pure science and math. Which would not be advantageous to their future income. And what about going into education, journalism, the peace corps….?

    Assessing teachers based on students’ future salaries misses the point. I’d rather produce a good person than a good earner.

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  2. Ira says:

    What a scary thought every teacher trying to create a world of CEOs and lawyers so that they can pay their rent. I think I will opt out of that system thanks.

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  3. Mike says:

    A form of this is done in club soccer around the world. Poor “clubs” sell the rights to the most talented players to bigger/richer soccer clubs. Even at the professional level, players are sold and loaned to other clubs.

    When players no longer have promise or don’t improve as much as needed, they are replaced with players with more promise.

    Although this system is imperfect since much of what is taught in school has little monetary value, I do think we need to encourage more of our students to follow more practical areas of study (many of our doctors, scientists, and engineers are from foreign countries).

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  4. Eric W says:

    Wow, how many different ways this would be a bad idea.

    1) Wise teachers would never want to teach where students have a, statistically, poor lifetime earnings potential.

    2) I see only a small overlap between “a good, sound, education” and “teaching someone to be monetarily successful”

    3) Punishing teachers for factors well outside their control

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  5. ilze42 says:

    Quite a scary thought if you consider how many brights kids we all knew at school who turned out to be bums of some description in adulthood.

    This is a particularly risky investment because a person emobodies too many variables you can’t possibly control for, especially when one considers that to reach adulthood one first has to survive being a teenager – a challenge that has thwarted many a promising child.

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  6. Mike says:

    My wife (a teacher) and I have talked about this before. But as becomes apparent from even a cursory analysis, there are real problems with this idea. It gives even more incentives for the really good teachers to move to district with high “success” rates. It seems rather implausible that a teacher under this system would want to teach in a school where there are bad family/home dynamics, insufficient economic resources to attain higher education, etc. In these schools a great teacher would be under-rewarded, whereas teachers in schools with lots of positives would be rewarded even if they are BAD teachers.

    It would also create a situation that would disadvantage schools with low enrollment. A teacher, just based on sheer odds, would want a class with MORE students for the increased chance of striking it rich. This might mean schools where teachers only teach 12 students per year (12 students * 30 years) have significantly fewer “chances” than teachers with say, 24-30 kids in a class.

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  7. matt says:

    Like most job in the corporate world, overall performance is derived from a multitude of objective metrics, observation and even subjective ratings. Teaching is no different and I believe it’s fully possible to create a thorough and balanced scorecard that combines such things as: student test and grade performance, attendance, graduation rates, student survey ratings (older children), parent survey ratings, administrator observation and peer teacher ratings.

    Now here’s my off the wall idea to drive better performance. What if a teacher kept the exact same class from first grade to high school graduation (for core classes). Wouldn’t it create more accountability across the whole system?

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  8. Mike K. says:

    However, the system wouldn’t have to work as a straight bulk system. It could be normalized to account for differences in number of kids and differences in expected income. Teachers could be paid for “value over replacement teacher” – the amount more that students in their classes make per student relative to the school as a whole. If the incentives were large enough, one could see this actually encouraging teachers to go to schools with lower averages, since a dramatic impact would probably be easier to achieve.

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