Template-type: ReDIF-Paper 1.0 Author-Name: Yusuke Jinnai Author-Name-First: Yusuke Author-Name-Last: Jinnai Author-Workplace-Name: International Univeristy of Japan Title: To Introduce or Not To Introduce Monetary Bonuses: The Cost of Repealing Teacher Incentives Abstract: Teacher performance pay programs form the foundation of recent reforms in public education. Although existing research has found monetary bonuses for teachers increase student achievement, no studies have examined the potentially negative effects of repealing such incentives. Using novel data from North Carolina, where the state government first reduced and finally repealed its teacher incentive program, this paper shows that student achievement at the lowest-performing schools significantly decreased after the reduction in bonuses and further decreased after the repeal of the incentive program. These findings illustrate that once incentives are introduced it is not cost-free to reduce or remove them. Classification-JEL: I21, H4 Length: 22 pages Creation-Date: 2016-01 Number: EMS_2016_08 File-URL: https://www.iuj.ac.jp/workingpapers/index.cfm?File=EMS_2016_08.pdf File-Format: Application/pdf File-Function: First version, 2016 File-Size: 323KB Keywords: School accountability, Performance pay, Teacher incentives Handle: RePEc:iuj:wpaper:EMS_2016_08