School competition and teacher labor markets: Evidence from charter school entry in North Carolina

I analyze changes in teacher turnover, hiring, effectiveness, and salaries at traditional public schools after the opening of a nearby charter school. While I find small effects on turnover overall, difficult to staff schools (low-income, high-minority share) hired fewer new teachers and experienced small declines in teacher quality. I also find evidence of a demand side response where schools increased teacher compensation to better retain quality teachers. The results are robust across a variety of alternate specifications to account for non-random charter entry.

► I analyze the effect of charter entry on teacher labor markets at incumbent schools. ► I analyze a range of outcomes including teacher turnover, hiring, effectiveness, and salaries. ► Difficult to staff schools saw reductions in teacher hires and teacher quality after charter entry. ► Charter entry is associated with increased teacher pay — evidence of a demand-side response.