68 EUROPEAN EDUCATION 68 European Education, vol. 42, no. 3 (Fall 2010), pp. 68–89. © 2010 M.E. Sharpe, Inc. All rights reserved. ISSN 1056–4934/2010 $9.50 + 0.00. DOI 10.2753/EUE1056-4934420304 MAGDA NUTSA KOBAKHIDZE Teacher Incentives and the Future of Merit-Based Pay in Georgia This study summarizes the empirical results of school-level research done in Georgia, one of the post-Soviet, Caucasian states, in October 2009. The findings drawn from qualitative and quantitative data describe current policies regarding teacher salaries and incentives in Georgia and identify future possible policy strategies aimed at the country’s teacher profession. The paper stresses the importance of introducing more centrally planned as well as school-level incentives in Georgia. Data analysis shows that teachers in Georgia have mixed feelings regarding merit-based pay reform. If implemented, this type of reform would arrive too early since Georgia does not yet have the centralized system of teacher evaluation. Instead, all teachers may be rewarded additionally to give them economic stimulus and motivation for better performance. Teacher quality remains one of the main educational policy challenges around the world, but developing countries face the issue more often and acutely than other countries. Attracting and retaining qualified teachers requires well-designed and targeted programs of teacher preparation and training. Given low salaries and limited incentives, teachers in developing countries often cite lack of motivation and enthusiasm for the failure to better perform. Accordingly, this study investigates policies regarding teacher salaries and incentive initiatives, specifically in Georgia, one of the post-Soviet, Caucasian states. Owing to Georgia’s socioeconomic conditions, with limited public resources available for the education sector, teaching remains a low-paid profession. Since the 1990s, poor working conditions have forced many teachers to leave the profession Magda Nutsa Kobakhidze holds an M.A. in international education development from Teachers College, Columbia University. Her academic interests mainly focus on educa- tion policies, institutional change, and development in the post-Soviet space. Address for correspondence: nkobakhidze@gmail.com.