This article takes advantage of a unique policy change to examine how principals make decisions regarding teacher dismissal. In 2004, the Chicago Public Schools (CPS) and Chicago Teachers Union signed a new collective bargaining agreement that gave principals the flexibility to dismiss probationary teachers for any reason and without the…

If principals have the authority to dismiss teachers, will they dismiss the less effective ones, or will they instead make perverse decisions by letting the good teachers go? Evidence from low-stakes surveys suggests that principals are able to identify the most and least effective teachers in their schools, as measured by their impact on student…