Although there is a growing recognition that the traditional teacher salary schedule does not reward the most effective teachers, most U.S. school districts don't offer teacher incentives for improving student performance and the vast majority of teachers actually oppose such a plan. This Information Capsule reviewed recent studies conducted on the impact of performance pay programs on students' academic achievement and found that they have produced mixed results. Most researchers have concluded therefore that higher levels of student achievement cannot be directly attributed to performance pay programs. The multitude of factors involved in human learning lessens the impact of market-based strategies, on which performance pay is based. A summary of elements of successful performance pay programs is also provided.