What Do Teacher Pensions and Marshmallows for Kids Have in Common?
Last year, I told you about an intriguing follow-up to the much-cited "marshmallow study," which suggested that regardless of their "self-control," children can delay their impulse to immediate gratification much longer when they trust the person in charge to make good on his promise of extra treats in exchange for a longer wait.
I can't help but be reminded of how quickly those children munched down on the marshmallow when they didn't trust the guy in charge, when reading a post by my colleague Stephen Sawchuk over at Teacher Beat, covering a new Cornell University study of teacher-pension decisions.
Taking advantage of a natural experiment in the form of an Illinois 1998 teacher-pay policy shift, Maria Fitzpatrick, a Cornell assistant professor in the policy, analysis, and management department, found that teachers were willing to trade only about up to 20 cents of their current salary for each dollar of a more-generous pension payout later.
As Steve describes it:
There's an important policy implication here when you consider that both traditional teacher-salary schedules and defined-benefit pensions are heavily backloaded, rewarding teachers that have stuck around for a long time. There have been efforts to try to upend that by "frontloading" salaries—under the theory that it will make the profession more attractive and increase the quality of the candidate pool, for instance. But they haven't really caught on.
And it's a question worth prodding, Fitzpatrick said.
"It calls into question the way that we're paying teachers," she said about her study's implications. "On the margins at least, we could be increasing salary rather than pensions, and potentially getting more for it."
Fitzpatrick also notes that pensions are a benefit that can't really be leveraged for a mortgage or other activity before a teacher actually retires, and I wonder if that plays a role. States have been rearranging or outright reneging on pension promises for decades now, and it might be that wary teachers, like the at-risk kids in the laboratory, figure they'd better take what they can get now, rather than relying on promises later.