Alternative Opportunities in the Female Labor Market and Teacher Supply and Quality: 1940-1990

Marigee Bacolod, University of California at Los Angeles

In this paper, I estimate the effect of changes in teacher earnings relative to professional earnings opportunities on teacher supply and teacher quality. I analyze data from the Integrated Public Use Microdata Series of 1940-1990, the National Longitudinal Surveys of Young Men, Young Women, and Youth-79, and the CIRP Freshman Surveys from 1971-1995 of college freshmen from more than 1,700 institutions. I find that teacher performance on standardized exams declines between 1970 and 1990. Prospective education majors are increasingly being drawn from less selective institutions. Ceteris paribus, a 10 percent increase in entry teacher earnings relative to professionals raises the probability that skilled women choose teaching by 32 to 47 percent for blacks and 18 to 40 percent for whites. Raising relative teacher wages also significantly attracts teachers who perform better on standardized tests and prospective education majors from highly selective institutions. Specification checks imply that the results are robust to various identifying assumptions.