Recent Faculty Publications on Fiscal and Labor Market Consequences of Teacher Pensions
“Teacher shortages” in public school classrooms are very much in the news. In addition, stock market declines have further exacerbated the fiscal problems of public school teacher pension plans. A team of researchers in the Department of Economics at the University of Missouri, including faculty members Cory Koedel, Shawn Ni, and Michael Podgursky, along with several economics PhD students and postdoctoral researchers, have recently published six articles in peer-reviewed academic journals analyzing the labor market effects of teacher pension plans and possible reforms that would put them on a more sustainable path. With PhD student Xiqian Wang, Drs. Ni and Podgursky analyze how enhancements in the Saint Louis public school teacher pension plan during the 1990s shortened the careers of teachers and thus exacerbated teacher shortages (“Teacher Pension Enhancements and Staffing in an Urban School District,” Journal of Pension Economics and Finance, Summer 2021). Another article by the same authorship group analyzes the cost and labor market effects of targeted bonuses designed to retain high quality teachers in the classroom (“Teacher Pension Plan Incentives, Retirement Decisions, and Workforce Quality,” Journal of Human Resources, January 2022.) An article by Drs. Koedel, Ni, and Podgursky, along with MU post-doctoral fellow Dongwoo Kim, and PhD students Wei Kong and Weiwei Wu, provides further analysis of targeted teacher retention bonuses (“Pensions and Late-Career Teacher Retention,” Education Finance and Policy, Winter 2021). An article by Drs. Ni and Podgursky with PhD student Fangda Wang was just published in an American Economic Association flagship journal and reassesses the value active teachers place on retirement benefits (“How Much are Public School Teachers Willing to Pay for Retirement Benefits? Comment,” American Economic Journal: Economic Policy, Summer 2022). An article by Dr. Koedel, Dongwoo Kim, and PhD student Brett Xiang examines the extent to which pension costs crowd out teacher salary expenditures (“The Trade-off Between Pension Costs and Salary Expenditures in the Public Sector,” Journal of Pension Economics and Finance, Winter 2021). Finally, Dr. Ni and Wei Kong study the effect of Missouri teacher pension enhancements during the 1990’s and simulate the effect of a voluntary conversion to a DC plan. This paper is forthcoming in a special issue of Educational Researcher on teacher pensions which is guest-edited by Podgursky and Kata Mihaly (RAND). Much of this work was supported by a research grant from the Laura and John Arnold Foundation.