Abstract
I explore the relationship among teacher salaries across Pennsylvania school districts. Using techniques developed in spatial econometrics, I find that the error terms in a salary regression are spatially correlated, suggesting evidence of omitted labor market factors. I also find evidence that salaries in nearby, financially similar districts directly influence teacher salaries in a particular district, which is evidence of pattern bargaining or more informal social comparisons across districts. Econometric specifications that ignore these factors overstate the influence of own-district variables, such as economic indicators, on salary.
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I thank colleagues Linda Babcock and John Engberg for very valuable contributions and for use of their data. Thanks also to Wil Gorr, who helped with some of the GIS aspects of this research. A National Science Foundation grant supported data collection.
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Greenbaum, R.T. A spatial study of teachers’ salaries in Pennsylvania school districts. J Labor Res 23, 69–86 (2002). https://doi.org/10.1007/s12122-002-1019-1
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DOI: https://doi.org/10.1007/s12122-002-1019-1