Better teachers and lifetime income

I had some excellent teachers in school. They did a lot of good and deserve great praise. I also had some terrible teachers in school. I imagine we all did. The sort who you made you uncomfortable asking a question, or those who would have you "study chapter 6" while they caught up with the Irish Independent. With millions of tax records, Chetty et al have some numbers contrasting the long-term effects of good and bad teachers.

Raj Chetty, John N. Friedman, and Jonah E. Rockoff (2011) The Long-Term Impacts of Teachers: Teacher Value-Added and Student Outcomes in Adulthood. NBER Working Paper No. 17699.

Abstract Are teachers’ impacts on students’ test scores (“value-added”) a good measure of their quality? This question has sparked debate largely because of disagreement about (1) whether value-added (VA) provides unbiased estimates of teachers’ impacts on student achievement and (2) whether high-VA teachers improve students’ long-term outcomes. We address these two issues by analyzing school district data from grades 3-8 for 2.5 million children linked to tax records on parent characteristics and adult outcomes. We find no evidence of bias in VA estimates using previously unobserved parent characteristics and a quasi-experimental research design based on changes in teaching staff. Students assigned to high-VA teachers are more likely to attend college, attend higher- ranked colleges, earn higher salaries, live in higher SES neighborhoods, and save more for retirement. They are also less likely to have children as teenagers. Teachers have large impacts in all grades from 4 to 8. On average, a one standard deviation improvement in teacher VA in a single grade raises earnings by about 1% at age 28. Replacing a teacher whose VA is in the bottom 5% with an average teacher would increase the present value of students’ lifetime income by more than $250,000 for the average class- room in our sample. We conclude that good teachers create substantial economic value and that test score impacts are helpful in identifying such teachers.