Research has consistently shown that teacher quality is distributed very unevenly among schools, to the clear disadvantage of minority students and those from low-income families. Using North Carolina data on the length of time individual teachers remain in their schools, we examine the potential for using salary differentials to overcome this pattern. We conclude that salary differentials are a far less effective tool for retaining teachers with strong preservice qualifications than for retaining other teachers in schools with high proportions of minority students. Consequently large salary differences would be needed to level the playing field when schools are segregated. This conclusion reflects our finding that teachers with stronger qualifications are both more responsive to the racial and socioeconomic mix of a school's students and less responsive to salary than are their less-qualified counterparts when making decisions about remaining in their current school, moving to another school or district, or leaving the teaching profession.

Using detailed data from North Carolina, we examine the frequency, incidence, and consequences of teacher absences in public schools as well as the impact of a policy designed to reduce absences. The incidence of teacher absences is regressive: when schools are ranked by the fraction of students receiving free or reduced price lunches, teachers in the lowest income quartile average almost one extra sick day per school year than teachers in the highest income quartile, and schools with persistently high rates of teacher absence were much more likely to serve low-income than high-income students. In regression models incorporating teacher fixed effects, absences are associated with lower student achievement in elementary grades. Finally, we present evidence that the demand for discretionary absences is price elastic. Our estimates suggest that a policy intervention that simultaneously raises teacher base salaries and broadens financial penalties for absences could both raise teachers' expected incomes and lower districts' expected costs.