New Yorkers love themselves some incentives. We have incentives for students to do well on tests and incentives for parents to take their kids to the doctor. Now that we can't enjoy a meal without contemplating its caloric content, we have guilt-based incentives to eat Pinkberry yogurt instead of Beard Papa's cream puffs. Last week, the New Teacher Project argued that teachers in the "Absent Teacher Reserve" have no incentive to get a job. This morning, it's clear that, in many cases, principals have no incentive to hire them.

On Friday, I showed that experienced teachers are more likely to remain in the Absent Teacher Reserve, and asked what role financial incentives might play in producing this outcome. Of teachers excessed in 2006, only 22% had 13+ years of experience. Of the 2006 teachers who remained unplaced as of December 2007, 42% had 13+ years of experience. Under Fair Student Funding, which allocates dollars rather than positions to principals, a rational principal would choose a $40,000 teacher over an $75,000 one, all else equal. But FSF didn't come online until 2007, and thus can't account for this pattern.

But a more basic incentive problem predates Fair Student Funding - ATR teachers are off-budget. Imagine that you're a principal and through the ATR pool, you've identified a teacher with 20 years of experience that you'd like to have on board. You can give the teacher a full-time class and acquire him at no cost, or you can shell out a pile of money. In the former scenario, the teacher is happy (he's getting paid a full salary and has no reason to leave) and the principal is happy - he's scored a free teacher.

This morning, Elizabeth Green reported that 29% of the absent teacher reserve pool (194 of the 665 teachers) are teaching full courseloads. Edwize provides a list of schools in which teachers have full-time positions and more details. While we're kvetching about aligning incentives, we should get them aligned for principals, too.