Welcome to the Profit of Education website. Continuing the conversation begun in the book Profit of Education, we discuss the latest economic evidence on education reform.

Paying for master’s degrees

You probably know the following fact:

  • Almost half of teachers have master’s degrees. In fact, more masters are given in education than in any other subject.

My surmise has always been that the driving force behind the huge number of masters is the salary bump that comes with earning agraduate degree. Apparently it’s not quite so simple.

Raegen Miller and Marguerite Roza put together data on the salary bump in each state (adjusted for the cost of living) and the fraction of teachers in that state with a master’s. In eight states, a master’s is required for a full, permanent teacher’s license. I’ve taken the Miller/Roza and plotted it. The master’s-required states are in red, the remainder in blue. And the upward sloping line is drawn using only the blue points.

In the “we don’t require a master’s” states, the salary bump that teachers earn definitely encourages more masters. Higher master’s salaries explain about 13 (of 40) percentage points of the difference between the fraction of teachers with higher degrees in the lowest bump versus the highest bump state.

In contrast, in the states that require masters for full licensure the extra salary doesn’t seem to make much difference. The requirement itself does, unsurprisingly, encourage earning a graduate degree–about 14 points worth.

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