What is the "best" way to pay teachers? Few policymakers are pleased with the current system, but attempts to move toward merit pay have largely been short-lived and unsuccessful. While there is no perfect teacher compensation system, research evidence can help policymakers choose and adapt a plan likely to work well within a particular context. Critics of both traditional compensation and newer alternatives are quick to point out the strengths of the system they support, but the limitations of individual systems are frequently misunderstood or unrecognized. To improve the viability of a new plan, policymakers and stakeholders should conduct extensive analyses before implementation.