Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/315908 
Year of Publication: 
2025
Series/Report no.: 
IDB Working Paper Series No. IDB-WP-01674
Publisher: 
Inter-American Development Bank (IDB), Washington, DC
Abstract: 
Teacher turnover is a major challenge for human resource management in schools, adversely affecting student learning. We examine the impact of a monetary incentive program introduced in 2022 in the city of Sao Paulo, Brazil, which aims to reduce teacher turnover by allocating wage premiums ranging from 5% to 25% of base salary based on schools turnover levels. Our results show a significant reduction in turnover: an average decrease of 18% across all schools, with an even more pronounced 30% reduction in schools offering higher incentives. Notably, the program also attracted new teachers to these higher-incentive schools. An analysis of teacher preferences similarly reveals a shift towards schools offering greater wage premiums. Furthermore, we find that schools offering high incentives experienced significant improvements in student test scores, with gains of 0.3-0.6 standard deviations in standardized assessments. The findings demonstrate the effectiveness of monetary incentives in mitigating teacher turnover and improving educational outcomes, providing evidence-based guidance for policymakers developing teacher retention strategies.
Subjects: 
teachers
financial incentives
teacher shortage
teacher sorting
turnover rates
disadvantaged schools
Brazil
JEL: 
I21
J45
J63
M52
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Working Paper

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