When Does Teacher Licensure Make Sense?

Abstract Teacher licensure is a regime where schools are forbidden from hiring teachers who have not completed a program of study in a teacher education program and/or other preparation requirements. This paper specifies a theoretical model of a school hiring teachers who are either traditional—completed a program of study in a teacher education program or alternative—entered teaching through an alternative path. We combine the implications of the theoretical model with the empirical literature on teacher labor markets to reach conclusions about how labor market policies would impact teacher quality. Perhaps the most important conclusion is that it is very likely that a regime of teacher licensure would lower teacher quality and student achievement. The key reason why licensure would lower teacher quality is that licensure fails to make the important distinction between marginal and average quality in hiring decisions.