In a policy brief written with his usual clarity and elegance, UC Santa Barbara economist Richard Startz and author of Profit of Education (one of our favorite books) puts forth a reassuring argument. The fact that school-based ed reforms (such as improved teacher quality or reduced class size in the primary grades) explains only a small fraction of variation in student outcomes does not mean that those reforms aren't likely to have an important and cost-effective benefit. Using two real-world examples and then a quantitative model of the "decomposition of variance," Startz makes the case that the important thing on which ed reformers should focus is impact, pure and simple. He cites the well-known Tennessee STAR study of small class size as one of his two examples: the impact of class size reduction was sufficiently large that the fact that background variables "out-explain" performance effects of the intervention by thirty to one did not change the calculation that it was still a viable reform strategy.
To paraphrase Startz, the bottom line on teacher quality is this: Because the marginal impact of having a better teacher is huge, the fact that teacher inputs explain very little of student outcomes is immaterial to assessing the promise of policy interventions related to teacher inputs.
Whew! We feel better already!