Which Teachers Choose a Defined Contribution Pension Plan? Evidence from the Florida Retirement System

Matthew M. Chingos, Martin R. West
2015 Education Finance and Policy  
Since 2002, public school teachers in Florida have been permitted to choose between a defined benefit (DB) and a defined contribution (DC) retirement plan. We exploit this unique policy environment to study new teachers' revealed preferences over pension plan structures. Roughly thirty percent of teachers hired between 2003 and 2008 selected the DC plan, despite the fact that teachers not actively deciding within six months were defaulted into the DB plan. The share choosing the DC plan was
more » ... the DC plan was higher among teachers with advanced degrees, math and science teachers, and teachers in charter schools. It was lower among special education teachers and especially among black and Hispanic teachers. There was only a slight relationship between plan choice and teacher value-added to student achievement, with teachers in the bottom value-added quartile roughly two percentage points less likely to choose the DC option.
doi:10.1162/edfp_a_00158 fatcat:ykluwg7yojboxoenjoxyhxnljm