Historically, teacher evaluation systems have identified few teachers as low-performing and needing improvement. In 2012, at the beginning of a national reform movement, Chicago Public Schools implemented its overhauled evaluation system, which incorporated multiple measures of teaching practice and dismissal plans for low-rated teachers. We find that the reform increased the exit rate of low-rated tenured teachers by 50 percent. At the same time, the teachers who replaced the exited teachers were significantly higher-performing. Ultimately, the accountability function of the reformed teacher evaluation policy resulted in higher teaching quality. However, the policy impact was limited because very few teachers received low ratings under the reformed system. Policy simulation results suggest that the available teacher labor supply is likely sufficient to set a higher standard for satisfactory teaching.

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