Tying teachers' pay to their classroom performance should, says Victor Lavy, improve the current educational system both by clarifying teaching goals and by attracting and retaining the most productive teachers. But implementing pay for performance poses many practical challenges, because measuring individual teachers' performance is difficult.…

This final report of a collaborative project to design teacher incentive structures describes the procedural development and results of studies conducted by participants composed of public and private school representatives, community members, the University of Toledo, and others. Part 1 includes details of such project planning processes as…