Current interest in teacher evaluation focuses disproportionately on measurement issues and performance-based pay without an overarching theory of how evaluation works. To develop such a theory, I contrast two motivation theories often used to guide thinking about teacher evaluation. External motivation theory relies on economics and extrinsic incentives. Internal motivation uses psychology and intrinsic incentives. These theories and available evidence raise doubts about performance-based pay, but not the use of other extrinsic incentives. These theories also suggest that to maintain effective intrinsic incentives, policies to remove ineffective teachers should not reduce autonomy or trust among effective teachers and that evaluations should provide teachers with useful feedback and policy makers with information on the conditions that facilitate good teaching.
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