ePack: Principles of Microeconomics 6th Edition by Gregory Mankiw

Exercise 7

A current debate in education is whether teachers should be paid on a standard pay scale based solely upon their years of training and teaching experience, or whether part of their salary should be based upon their performance (called "merit pay").
a. Why might merit pay be desirable?
b. Who might be opposed to a system of merit pay?
c. What is a potential challenge of merit pay?
d. A related issue: Why might a school district decide to pay teachers significantly more than the salaries offered by surrounding districts?