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Comparative Wage Index

All types of workers—including teachers and other school district personnel—demand higher wages in areas with a high cost of living or a lack of desirable local amenities (e.g., good climate, low crime rates, high-quality schools, or access to shopping and medical facilities). As a result, the cost of hiring school district personnel varies geographically, and so does the cost of hiring other types of workers. The basic premise of a comparative wage index (CWI) is that one should be able to measure regional variations in the cost of hiring educators by observing variations in the earnings of comparable workers who are not educators. Intuitively, if accountants in the Chicago area are paid 5% more than the national average accounting wage, Chicago engineers are paid 5% ...

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