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It makes sense that if you have incentives for better performance, you will get better performance. If college students knew they could make more money being a teacher we'd get more people choosing education degrees, then we'd have a larger pool of teachers to choose from, so you'd expect better teachers would ultimately get hired.
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The research suggests that pay-for-performance plans, at least to date, do not work. Even in the corporate world most research suggests that pay isn't the best motivator for performance. Yes people need to be paid market rates, but beyond that things like clear goals, accountability, training and development, recognition, creating a respectful culture this is also a performance culture do more that bonuses.
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